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Guaranteed Asset Protection (GAP) with PowerBuy®
Move beyond the industry standard with a GAP program that delivers borrower benefits through the entire term of the loan.
First launched by SWBC in 2015, GAP with PowerBuy provides a holistic approach to loan protection that keeps the borrower covered through all stages of the loan. With coverage addressing both the outstanding loan balance as well as loss of value due to depreciation, GAP with PowerBuy provides the benefits that borrowers need to fully protect their vehicle investment following a total loss. Thanks to GAP, the deficiency balance may be waived and, thanks to PowerBuy, the borrower may be eligible for an additional depreciation benefit of up to $6,000 to apply toward a replacement vehicle financed with you.
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PowerBuy Equity Protection
Vehicles can depreciate at an alarming rate. Borrowers finance a vehicle today only to find it can lose value seemingly overnight. PowerBuy Equity Protection provides depreciation coverage up to $10,000 when your borrower returns to your financial institution following a total loss or unrecovered theft. The benefit is applied to the replacement vehicle loan financed with you as a down payment or principal reduction.
PowerBuy Equity Protection is a great option for borrowers who are in a positive equity position at the time of finance as an alternative to GAP, or as an additional benefit to supplement the protection that GAP provides.
The Difference Between Ordinary GAP and Shortfall Cover’s GAP with PowerBuy
Ordinary GAP Coverage
GAP Coverage may pay off an outstanding loan balance, but the consumer may have additional out-of-pocket costs.
GAP with PowerBuy
GAP with PowerBuy delivers borrower benefits through the entire term of a loan and offers coverage addressing both outstanding loan balance and depreciation loss.
Your borrower can purchase this coverage with a depreciation benefit of $2,500, $5,000, or $6,000. If their vehicle is declared a total loss after an accident or theft, they will receive the balance on the remainder of their loan or the reimbursement of the depreciation on their vehicle, whichever is greater.
GAP with PowerBuy is Designed to:
Increase Non-Interest Income
By offering GAP with PowerBuy, financial institutions add a valuable product to their point of sale offer to borrowers.
Holistic Coverage
GAP with PowerBuy provides a unique combination of protection for both lender and borrower. With traditional GAP coverage covering the outstanding loan balance, the PowerBuy benefit can provide a benefit toward replacing their vehicle after total loss.
Enhance Auto Lending and Recapture Strategies
Offer a product that differentiates your financial institution at the time of loan closing, as well as provides an incentive to your borrower to return to you for their replacement vehicle financing. Provide an exceptional product and service to your member that others in your market don’t.
Features & Benefits
Increases non-interest income and improves member retention rates.
Decreases your portfolio’s exposure to loss in high LTV loans and longer terms.
Provides additional borrower value by providing coverage even when they reach a positive equity position.
“The PowerBuy benefit helps us protect more members – including the borrowers who put money down when they purchase their vehicle.”
- John Phipps, Chief Lending Officer for Heritage Federal Credit Union
What can GAP with PowerBuy do for your borrowers?
Provides protection against depreciation after a total loss or unrecovered theft
Covers against outstanding loan balance if exceeds primary insurance carrier settlement
Benefits are available throughout the life of the loan
Coverages are available on many collateral types, including auto, motorcycles, travel trailers, watercrafts, and motor homes
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© Shortfall Cover, LLC. All rights reserved. Programs and coverages may vary by state/lender.