I’m in the market to buy a car, but I keep reading about Gap Insurance. Should I buy it?
Should I buy Gap Insurance when financing an auto?
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Here’s the deal: the second you sign the dotted line for a new car the value drops 20%. The same time next year, the value plunges another 10 – 15%. This goes on for another two years, then the value levels off somewhat but still continues to drop. Should the unthinkable occur, such as a collision or fire/flood that totals your vehicle, you are left owing the remainder of the actual cash value and what you owe to the leinholder. This could be thousands and thousands of dollars. GAP will cover this amount owed, so if you are dumb enough (just kidding) to purchase a new car then GAP is a must.