Are You "Upside Down" On Your Auto Loan?

Many people owe more than their car is worth, which is called by some as being "upside down" on their loan. Gap insurance can help. It can be invaluable to almost anyone who buys a new car or recent-model-year used car.

A gap car insurance policy covers the "gap" between what you owe and what your insurance company says your car is worth. And if you’re leasing your car, it’s very likely the leasing company will require gap insurance as well.

Standard automobile comprehensive and collision auto policies only cover your new car’s "fair market value," which may be less than the amount you owe for the first year or two of the loan. If the car is stolen or totaled in an accident, you might end up paying off the cost of a car that you can’t even drive!

Auto gap insurance is not a policy you’ll need forever, but for the first few years of ownership, it will give you some security and peace of mind while you’re driving. And the good thing about it is the cost is relatively low.

Don’t forget, you can shop online through Shop for a new or used auto online and take the hassle out of car buying. If you pre-approve your SACU auto loan and arrange for gap insurance before you even visit a showroom, you’ll be able to shop with "cash" in your pocket – and you’ll know you have everything covered.

Do you need a Gap Policy? You may, if your answer is yes to either of these questions.

	Do owe more than your car is worth?
	Do you lack the ready cash to cover the difference between what you owe and the car’s value in case of a total loss?