You should never need gap insurance on a used car. And if you traded in a paid off Leaf you should have positive equity. (not much but some!)
HELP! The car loan was denied after I already bought the car!?
- Thread starter dogememe
- Start date
You should never need gap insurance on a used car. And if you traded in a paid off Leaf you should have positive equity. (not much but some!)
A Nissan Leaf with a broken battery that only goes 20 miles of range isn't worth much
In a no money down situation, yeah, gap insurance becomes more important for some people. If you have enough cash in the bank though, you don't need gap insurance. In case you don't know what it is (if you do, I apologize), if the loan is $5000 but the vehicle depreciates to $3000, if it were totaled, regular insurance will only write a check for $3000. The bank will be holding their hand out for the add'l $2000 before they give up the title though. Gap insurance covers that "gap".
Not sure that any lender requires gap insurance. You can get gap insurance from your auto insurer instead of the one the dealer sells you too.
I was half kidding, but that's what I personally would pay for such as car. In fact I wrote "in my book".
It's unknown what he paid, and if it was a fair exchange, then fine. I'm not saying a Volt is a POS, but I would look new.
How much were they charging for gap insurance ?
$600
That's really, really low for gap insurance (and over the course of X years of the loan). $600 broke the loan with the credit union ? That's pretty surprising.
What was wrong with the Escape that you would trade it for this Leaf? Or is your description of broken battery 20 miles facetious?A Nissan Leaf with a broken battery that only goes 20 miles of range isn't worth much
It isn't. They were probably close to LTV thresholds and the $600 pushed it over the edge.
I told you not to get excited about this.
ALL dealers do spot deliveries, have been doing it for YEARS, and some dealers are VERY aggressive about it. The odds of losing a sale are dramatically reduced when you are driving their vehicle.
It's definitely a thing. However some of it is necessity vs chicanery...
Lets say your buying a car on Sunday - obviously Banks aren't available but the finance office has guidelines based on a persons credit report and the lenders they normally do business with they know what will fly most of the time so they write the contract on that basis... then they shop the lenders when they open to see who wants the loan. Probably 99 out of 100 times this works out fine at a reputable dealer, but sometimes not. If the dealer did in fact eat some or all of his gap insurance to make it fly, that's a far better than typical result when things go awry. It speaks well of the dealer IMO.
Less reputable dealers or those serving a certain clientele may use this practice in less than honorable ways, but in a credit driven society it is necessary on some level.
I think the reason we were all sort of surprised is that the normal process with a credit union at least in my experience is that you pre apply for the loan and they send you a pre approval letter you take to the dealer, It basically says "He/She is good to $XX,XXX.XX". The LTV is surprising as the last time i bought one using the credit union the conversation went something like "I want to buy a Ducati" / "How much is it?" / "about $22,000.00" / OK - Ill send you an approval letter / They did not even care what model...
If i new the exact one they would even send a check to me and the dealer and it had a line on the back that said basically by endorsing the check the dealer agreed to record a lien on the vehicle.
It has been a little while though, i just paid for the last few...
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In this case my vehicle purchase was on a week day around mid day. Everybody involved should have been awake.
Excellent outcome and in the end you paid less. Congrats.
Have to make assumptions here but yeah, the loan amount was probably pushing the threshold and then the gap pushed it over. I think in some circumstances, 'my' credit union would bend their rules a little bit after looking at "data" they have access to (about me or any borrower).
I wonder if the lender is informed that it was gap insurance that changed the amount? Or they just see the total number?
It was more than likely the total number. Lenders typically like that you purchase gap coverage. If something happens (like the vehicle gets totaled or stolen) their interests are protected and YOU are paying for it.
