When the time comes, there are many reasons to consider purchasing a pre-owned Lexus vehicle at Lexus of Valencia. You’ll save money on the down payment, have a lower depreciation rate, and access to protection options that ensure your investment is safe and sound. If you’re weighing GAP insurance for a used car, here’s what you need to know.
What is GAP Insurance?
GAP is an acronym for Guaranteed Asset Protection, but it’s an apt name for this kind of insurance. That’s because it covers the “gap” between your vehicle’s depreciated value and what your insurance coverage will pay out if your car has been damaged in an accident or stolen. Because it makes up the difference, you’re not left with a loss.
Why GAP Insurance is Good for Pre-Owned Cars
While GAP insurance is typically recommended for new or leased vehicles, there are certainly instances where it can be helpful to take out GAP insurance for pre-owned or L/Certified vehicles.
To start, if the length of your term is more than 60 months, GAP insurance may be the right choice for you. That’s because there’s a high possibility that you’ll end up paying more than the vehicle is worth on the car if it becomes totaled or stolen, and GAP insurance can help to prevent that. The same is true for vehicles with a down payment of less than 20% of the total cost of the car.
When weighing your options, you should consider other associated expenses like taxes, fees, extended warranties, etc. If the total is higher than the trade-in equity of the vehicle, GAP insurance may be a good choice.
Learn more about GAP insurance, Lexus financing, and other essential tools for vehicle purchasing, leasing, and protection here at Lexus of Valencia. Schedule an appointment with our expert team today.