GAP Protection
What is GAP Protection?
GAP is a voluntary, non-insurance product designed to waive the remaining loan balance not covered by the borrower's primary insurance carrier settlement in the event of a total loss or unrecovered theft, subject to limitations and exclusions, including but not limited to loan to value (LTV) maximum, delinquent payments, late charges, refundable service warranty contracts and other insurance related charges.
What does GAP cover?
GAP covers the difference between the borrower's outstanding loan balance and the actual cash value (ACV) of the vehicle up to the maximum LTV%. GAP may also cover up to $1,000.00 of the borrower's deductible if there is a "gap" after the primary insurance settlement is paid. The deductible is covered as part of the deficiency balance settlement. It is not paid directly to the borrower.
Benefits:
- 60 day refundable "free look" period
- May help the borrower avoid financial hardship and afford a replacement vehicle
- No model, mileage or year restrictions
- May prevent a deficiency balance from being added to new loan
- May help protect the borrower's credit rating
