What is a GAP Waiver? What Is It Used for?

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What it covers What it costs If it’s worth it If it’s required How to get it
GAP Waiver Meaning
What Is Loan-to-Value (LTV?)
What Does GAP Cover?
What Doesn't GAP Cover?
Loan balances over a specified LTV (such as over 150%) or amount Refundable additions made to your loan or lease contract, such as a vehicle service contract Loan interest accrued after the date you lost your car Past due loan payments Late charges and other fees Cost of renting a car
When Is a GAP Waiver Required?
Upside-Down Auto Loan
Little Down Payment
High Mileage
Luxury Car
High Interest Rates
Leased Vehicle
GAP Waiver Versus GAP Insurance
What Are the Benefits of GAP Waiver Insurance?
GAP Waiver Agreement
Buying a GAP Waiver Agreement
Adding GAP Coverage to an Existing Loan
The Average Cost of a GAP Waiver
GAP Refund
What Happens to My GAP Waiver When I Refinance My Vehicle?
The Takeaway
Frequently Asked Questions
About the Author
Jackie Lam is a freelance writer with experience covering small business, budgeting, freelancing and money, and personal finance. She has written for more than 60 outlets, including Salon.com, CNET, BuzzFeed, Business Insider, and Time's NextAdvisor. She is currently working on her AFC® financial coaching certification to help artists, freelancers, and small businesses.
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