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Normally the main penalty on a lease is the odometer, where you drive more miles than the lease allowed...you also have to turn in the car in good condition, or they can penalize you for dents, paint scratches, chipped glass, etc.
You are turning in a car that has supposedly had its problems fixed...maybe not the way you and I would think of it, but fixed nonetheless...after all, if you turned the car in with visible damage, THEY would have charged you for the repairs, but, instead, the "repairs" were paid by Allstate...
There may be a slim possibility that you may not be penalized at all, since the car has been restored pursuant to another "authority" in the name of Allstate...I wish you luck with this...
Also, read your lease agreement, as it may have a specific paragraph that discusses this very issue and how they handle it...while I have not had any experience with this, I am quite sure that the leasing company has...
Let us know your outcome...I would be happy to learn from your experience...
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They can't penalize you if you just have a glitchy car.
As long as you have made an effort to keep it up.
I might need to get gap insurance since my current insurer doesn't offer it. I don't want to change my insurance company, just want to buy a third-party GAP insurance. Which one would you guys recommend besides the ubiquitous $399 online gap insurance ads? (those seem a little overpriced, and have no idea of their reputation)
Thanks.
Thanks
Dealer's hate to give refunds. If you look at your loan agreement, whatever price you paid for gap coverage, figure the dealer kept 60-80% of that amount.
I was told by a dealer once, that the ENTIRE loan balance would be paid for by loan gap, even if you were upside down on a vehicle. Meaning, if there was a balance from the other vehicle that was tacked on to your new loan, he is saying that loan gap would pay ALL of it. Is this true???? I know that insurance loan gap will not pay finance charges, overdue principals outstanding or penalties of leased vehicles, etc. I can't take his word for it, and he could not provide it in writing since I was not buying a car, I was only calling to inquire.
Also, when leasing vehicles, isn't lease gap included now?
After the loan is paid off why can't someone just call their insurance company and tell them to cancel the GAP insurance? :confuse:
When I bought my car a year ago the finance manager tacked on GAP insurance for an additional $599. I went home and discovered that my car insurance company offered it for $6/mo. I went back the next business day and canceled the dealership's coverage.
$599 is what the dealer charged, $6 a month is what your insurance charged.....for how many months. Gotta compare apples to apples. Did the insurance company offer to waive the deductible if you ever used it? The coverage varies from company to company (dealership and insurance provider) so its hard to tell which is the better deal sometimes.
You charge $599 for GAP insurance (which is useless the last year and half of a 60 month loan) and add it to the monthly car payment so they are paying it the entire length of the loan. So the actually cost of the GAP insurance is $599 plus the interest rate over the length of the loan. And of course you can't cancel it or people simply forget it's there. At least with your insurance company, you can cancel it at anytime, like the last two years of the loan when equity of the car may be greater than the amount owed (of course this depends on the car, loan amount, interest rate, down payment, etc).
Quite honestly, if your insurance company offers GAP insurance, it is a much better bargain than what the dealership offers. GAP insurance is like extended warranties, it's for people who are looking for peace of mind. Nothing something I would ever buy but I can understand why people buy it.
You charge $599 for GAP insurance (which is useless the last year and half of a 60 month loan) and add it to the monthly car payment so they are paying it the entire length of the loan. So the actually cost of the GAP insurance is $599 plus the interest rate over the length of the loan
There is no way to determine the value of a car 4 1/2 years out, so thats an assumption on your part. It never ceases to amaze me how many people are obsessed with the tiny interest charges on this amount of money. "I'll put it into a high-yield cd, etc, etc, etc." I'm so glad everyone has a plan to become millionaires by investing the charge of extended warranties and GAP policies, because interest on that amount of money is HUGE!!!
And of course you can't cancel it or people simply forget it's there
What?!?! I think i know what you were trying to say. You can go to the dealership at anytime and cancel GAP. Did you read the original post i was responding to when the poster said he cancelled the GAP policy he purchased at the dealership?
Quite honestly, if your insurance company offers GAP insurance, it is a much better bargain than what the dealership offers. GAP insurance is like extended warranties, it's for people who are looking for peace of mind. Nothing something I would ever buy but I can understand why people buy it.
The value would depend on the cost and coverage levels. If i sell you GAP for $200, now the dealerships GAP is a better value then the insurance companies-everythings not so black and white, there's a gray area. You're entitled to your opinion, but if you finance a car with no money down or trade equity, GAP is a no-brainer. Even a biased site like edmunds will usually agree with that.
Just like with warranty's, if someone who doesn't have GAP totals a car and the insurance company won't pay off the loan, now they're the "evil insurance company."
When did I mention anything about high yield cd, etc., etc. etc.? My opinion is based on where I've read that most cars reach their equilibrium about month 42-44 in a 60 month loan. Since you are an F&I guy, you should be able to confirm or deny this, instead of stating that "there is no way to determine....." Also GAP insurance kicks in when a car is totaled. I've been fortunate to not have had such a devestating event nor have I had a moving violation in over 25 years.
The value would depend on the cost and coverage levels. If i sell you GAP for $200, now the dealerships GAP is a better value then the insurance companies-everythings not so black and white, there's a gray area.
So now you sell GAP insurance for $200???? $200 would be a great price for GAP insurance. I've never heard of a dealer going that low. Most of the time it's "it will only be an additional $xx a month". I agree that everyone should consider it if you do a no money down loan or a buy a car that depreciates quickly.
My point is simple, from my experience, GAP insurance bought through a dealership is over-priced. If you feel the need to have it (personal choice), check with your own insurance company first. Like the previous poster mentioned most insurance companies charge around $6/month although I have seen cheaper. Your GAP insurance at $599 on a 60 month loan would be a minimum of $10/month not including interest. Basically, I am a cheap person (it's my engineering background). I would rather not pay extra for something that I may or may not need. if I do make the decision to buy something like this, I will definitely pay as little as possible.
fandiguy: we differ on this issue and that is fine but please keep the insults to yourself. I've been a member of Edmunds since the mid 90s and have been a very active participant in these forums. I try to offer my opinion on various topics without insulting people or name calling. I like a good argument or debate but always try to be fair and remember to treat people respectfully. I also try not to use terms like "idiotic".
They have a Platinum Package that adds Safe Driving Bonus where you get 5% of your premium back if you do not have an accident for 6 months. Comparing that it would have cost me $15 more every six months EVEN if I got the 5% back. The Accident Forgivenss package noted for multiple accidents where the Gold Package was probably non-multiple.
I'm comfortable with this and in my situation I decided this worked out best.
Bill
i just read the posts but it does not seem like a definite answer was found. so could i get the dedcutible of $500 from them even though i did not have to use gap to cover the loss as i owed less money. thanks
$10000 on your auto loan and your auto insurance company settled the ACV at $10000, but cut a check for just $9500 (ACV less $500 deductible), the Gap coverage should respond to that loss and pick up your $500 out of pocket loss.
However if your insurance company said the ACV was $11,000 and cut a
check for $10,500., you'd be out the $500 deductible. The gap waiver/insurance doesn't respond when you don't have to come out of pocket for anything,
Hope this helps. FYI...read your waiver/insurance form, you may be entitled to a refund of the unearned portion of what you paid for the gap, even when a loss is paid...that might get back of little of that deductible loss your suffered.
So the apparent savings with your own insurance company is none.
Last do you really want your own insurance company to hold all the eggs in one basket? If there is an accident and it is on the line of being totalled or not being totaled do you think they are looking out for your best interest if the eggs in are in there basket? Something to think about!
So this is a biased opinion.
Buying GAP from your insurance company is the worst investment...
It's not an investment, it's insurance. The money spent on it is exactly that - an expenditure. And tell me how paying $499.00 to $599.00, with interest added, is better than paying $10.00-15.00/6 mo. And you may cancel it at any time when your car is worth more than what you owe - usually within three years, unless some obscene amount of negative equity was rolled into the new loan.
Last do you really want your own insurance company to hold all the eggs in one basket?
I prefer to deal with my insurance company rather than an outfit I've never dealt with.
So this is a biased opinion.
Buying GAP from your insurance company is the worst investment...
It's not an investment, it's insurance. The money spent on it is exactly that - an expenditure. And tell me how paying $499.00 to $599.00, with interest added, is better than paying $10.00-15.00/6 mo. And you may cancel it at any time when your car is worth more than what you owe - usually within three years, unless some obscene amount of negative equity was rolled into the new loan. "
Depends on the circumstances. I don't have a loan on my 2008 Saturn Outlook so GAP would be a waste. I took New Car Replacement coverage with my insurance. For less than $5 a month IF my vehicle is totaled, they will replace it with a new one. After 3 model years that drops off. Traditional GAP would not do me any good, but NCR would for the first 3 years actually do better than GAP, IMHO.
I don't know exactly how this would work, but I would think Allstate would do the NCR and then try to recover whatever they could from the other party if the OP was at fault.
Everyone's opinion is biased, whether by experience, hearsay, or profession. Bias is only bad if it's not disclosed, and at least he didn't pose as a "satisfied customer" - he's been honest with everyone.
It's good to get opinions from a variety of perspectives. All the better to help people make choices.
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I have 100% success rate with GAP claims that I have sold. Every claim has paid in full. On several occasions I can remember having to roll neg equity into a loan for the GAP the insurance companies plan did not cover.
A word of advise, if you want GAP insurance and you plan on using your insurance company make sure the loan is in line with there plan. On 5 or 6 occasions I have had people tell me they would get there own GAP with there company and then find out the coverage was to much for them to write the plan, by the time they call me there contract is gone and they are SOL.
Sorry if my initial response came out a little snappy. I guess what I meant was that (as someone else pointed out) we shouldn't totally dismiss one option or the other. Dealers' GAP may work better for some, InsCo GAP - for others. It depends on individual situations and needs.
Thank you
And yes, it really depends on the details of your purchase, load balance if any, etc.
For those who are considering this coverage, most dealers will negotiate the rate of the coverage! Definetly worth at least asking! I basically just told them that my credit union offered gap for considerably less money and he moved on the price.
Can someone tell me where I can get GAP insurance for a 1 year old used car, 72 month loan, interest rate over 12 percent. 60 months would be OK. If you have a web site address that would help. I have tried so many that say variations of gap auto insurance in the web site address and they all end up being connected to Lee and Mason somehow.
Thank you very much.
Yes, the dealer offers gap waiver insurance, but they want $600 for it and that's too expensive for me. I need to get the total amount financed down and with having to also make a down payment to reduce the financed amount, I have nothing left to also pay the $600 out of pocket so I can keep the total amount I need financed down.
It looks like every gap policy in the country that an owner can purchase as an individual somehow comes through Lee & Mason even though you can buy it from a lot of web sites. All mention Lee & Mason as their agent. But Lee & Mason cap the interest rate you can be paying on your loan at 12.9% and unfortunately, I can't find a lender at that rate these days. (Hard for even me to believe, but, it's true).
My research is indicating that: 1. Some regular auto insurers offer gap insurance but seem to be for new cars, not used, and you have to have all your auto insurance with them. 2. Dealers can get gap waiver insurance where they and the lender forgive whatever is left to be paid on the loan if there's total loss of the car. 3. Individuals like me and you can buy gap insurance on the internet from companies that will sell you the insurance all by itself, and it can be for used or new cars, but, it all seems to come through Lee & Mason with the restrictions of: no more than 12.9% interest on loan, no more than 84 mo. on loan, 110 to 120 percent of value of car and a few other things. 4. Drivers Select offers a "Total Loss Protection" deal for $299 which allows higher interest rate and used cars, for 60 months but I can NOT understand how it works no matter how many times I read it, and when I try to call, I can hear the number being forwarded and then a guy comes on and says they are "certified" something or other and to leave a number and they will call back. I know their site links to a warranty site called certified. This may be because it is a Saturday, don't know.
I don't know if this will work for me or not. I can't afford to be left with thousands of dollars to pay if I lose the car. If you or anyone else can explain how this Driver's Select works, I'd love to hear. My question mostly is, what value are they putting on the totaled car? Where do they get it from? Here is the link: http://www.gap-insurance.com/indexTL.htm
IF you click anything else on the page, it takes you to their regular gap insurance, and to return to the Total Loss page you have to click the above link again.
Yes, the dealer offers gap waiver insurance, but they want $600 for it and that's too expensive for me
I can't afford to be left with thousands of dollars to pay if I lose the car
So pay the extra $12 a month and buy the GAP.
Over $300 I would most definitley want the contract in my loan and by some third party fly by night.
As far as the insurance companies go. Do you really want the company that decides weather your car is totaled also being the one that handles your GAP insurance?
Think about it. If the repair is less then the GAP guess what, there fixing your car. Where if the GAP is with a third party they will not care and probably total it.
My insurance company does not do GAP for used cars, so, I was not considering using them for GAP. And the problem is, I may not get financing for the car if I include the $600 GAP insurance in the financing contract. I think it would be the best way to go if I could also get financing, but, right now I have to reduce the amount I am trying to finance or I'm not going to be able to get any. It's a tough world out there credit-wise these days.
I am trying to find a company that offers GAP insurance for a 2008 car with a high interest rate loan. If you or anyone knows of such a company, please let me know. Thanks!