What is GAP insurance? | Should you get it?

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GAP insurance is something that many people don't know about when getting a car loan, but it can be something that truly saves you from a disastrous situation. Does that mean EVERYONE should get GAP insurance? NOPE! Watch to find out more!

Comment below with your thoughts and opinions!

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Awesome video and very informative, thanks! I (being a dumb first time buyer) paid a ridiculous 850 for gap and another ridiculous amount for extended warranty. Thanks to people like you with these types of videos, I'm now seeing this. 👍

InfantryNG
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You explain that perfectly thank you for also dumbing it down a little 😂😂🙏🏻

rocio
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Great video! Thank you for sharing your knowledge. I appreciate it.

cornflowercrafts
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Thank you very much, I learnt something just in time .

nikaward
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I just found out the total cost for my gap insurance through the dealership was 1000. He really didn’t explain this other than tell me what my monthly payment was but they added it to my loan so now I have an extra grand racked up on my loan. I’m going to try to cancel it.

janetd
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You can get the gap insurance through your car insurance. I am with progressive it it only costs me eight dollars per month.

truckingwithtobee
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On a brand new vehicle, gap is good. But you need it less as the vehicle depreciates. Find out the tipping point of when your vehicle is worth less than your remaining balance. At this point, gap is useless. Just like insurance, why pay more in insurance than what your vehicle is worth. ( Liability vs Full Coverage )

bruceblocker
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All products sold in a dealer F&I office, like an extended service contract or GAP, is a bet by the consumer. The consumer is betting he or she will recover more from the product than they paid for the product.

As with all bets, the rules are stacked in favor of the house, the dealer.

The key is in the details, how the dealer and the provider of the product price the product. For example, an extended service contract.

First, the provider of the service contract will determine the expected payout. This might be $800. On average, the provider will pay $800 for each contract.

Second, the provider will sell the contract to the dealer at a profit. For example, the contract expected to pay out $800 will be sold to the dealer for $1, 200.

Third, the dealer will sell to the buyer at a profit. Actually two profits one for the dealer and one for the F&I manager. For example, the dealer will sell the contract to the buyer for $2, 400..

So, in the end the buyer will pay $2, 400 for a product the experts know will likely payout only $800.

A bad bet.

jerrylundegaard
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I’m a military and I’m glad that the federal government put a stop to GAP insurance from dealership. They’re not allow to sell GAP insurance to us and they can get in a big trouble if they do. I bought mine through my insurance company which is like $275.

Kanti
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Question: when you refinance, is there a period of time you should wait to refinance? The dealership told us 12 months.... thank you!

rmg
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The whole system of insurance is convoluted against you. You get insurance and then have to get more insurance. If I had banked all the money I've paid into insurance companies for car health and life insurance over the course of my life I could easily retire and cover any eventualities life brings. Glad I took out the gap on my recent purchase for my overpriced used vehicle. Thanks for the information.

gregorytoddsmith
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I have a quick question..

I had my loaned car I was paying full coverage insurance.. I got involved of wet reckless (DuI) accident my insurance paid $4000 from $8000 and gap insurance will not pay it off because it was for criminal accident..

My question

1) Why the insurance will not pay the whole car if I was in a full coverage

2) Is there any way around to make the Gap insurance pay for it?

Any help I will really appreciated it
Thank you so much

raonzzz
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2019 dodge charger scatpack they gave me gap and 7 year mile bumper to bumper warranty is that a good deal?

kingblackss
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What happens when value of car is more than balance owed to bank, and I have gap coverage? My insurance company already paid bank off, so how and by whom do I get paid, for my loss?

guimbo
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Also get GAP if you buy a car that is known to be depreciated quickly, bmw, Mercedes, Kia, Hyundai, Ford just to mention a few.

tyrionlannister
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I'm leasing a Honda and it comes with free GAP coverage. Awesome video! I have a friend who got raped on his car loan. I'll definitely let him know he needs to get GAP, in case he gets into an accident and would still owe $10k.

nerdmoment
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Thank you. Is there a way to find out if the finance company is offering you what the true value is?

Sparklingchina
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Is the initial GAP Insurance refundable when you trade in your car and buy a new car from the same dealership?

nanaarmahni
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Awesome video. But don’t understand did u say $275 a month for gap coverage? So if my car payment is $800 a month, I’ll be paying $275 on top each month?

kashifnyc
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Well I was happy that I had bought gap insurance, cause it helped me out when I got into my accident.so it's good to have it cause never know.

palmergarage