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Can you cancel an Extended Warranty after purchase

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I had a relative who just recently purchased a 2018 Toyota. She financed the car and was approved by Toyota Financial with no money down with a credit score of 680. The dealership gave her an interest rate of 6.5% which I believe is kind of high for that credit score. Anyways, the finance manager told her he would

give her a good deal on her financing because she knew the salesperson. He said, he would lower the financing rate to 0.09% to save her money on interest which she can apply the savings towards getting extended warranties which she eventually bought. It seems like the finance manager pulled a fast one on her

to make money off the extended warranties.

 

I was wondering if she can cancel the extended warranties and GAP insurance which added an additional 3k to the total cost. She purchased the vehicle just two weeks ago.

 

 

 

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did she put down at least 30%? if not, the GAP might be important.

 

what is the APR cost of 6.5% versus .9%?

Edited by hegemony

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did she put down at least 30%? if not, the GAP might be important.

 

what is the APR cost of 6.5% versus .9%?

 

She didnt put any money down on a $23,000 vehicle. The GAP might be important.

The APR cost of 6.5% is about $5,200 compared to .09% is about $70.00 if my calculator is correct.

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Of course, she can cancel both the Service Contract and the GAP policy.

 

How do she go about cancelling the warranty and possibly GAP. Through the finance company or dealership? Would the dealership be able to change

the APR on the loan if she cancels?

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Go to the dealership sign the cancellation forms for the product (s) . Get a copy. Dealer can't change APR of a cashed contract.

 

Sent from my SM-N950U using Tapatalk

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+1 The loan is done and it can't be changed. The warranty refund will go to the finance company, paying down the principal amount and leading to an earlier payoff-- fewer payments. The monthly payment and the APR will not change. Interest will also be saved but only a tiny amount since the APR is near zero in the first place.

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Of course, she can cancel both the Service Contract and the GAP policy.

How do she go about cancelling the warranty and possibly GAP. Through the finance company or dealership? Would the dealership be able to change

the APR on the loan if she cancels?

Have her check with her insurance company and see if they offer gap. Some do some dont. Could be cheaper.

 

If not, Id keep the gap and cancel the service contract if she doesnt want it.

 

Her monthly payments probably wont change when she cancels any of it. It will reduce the loan amount so she will end up making fewer payments.

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Of course, she can cancel both the Service Contract and the GAP policy.

How do she go about cancelling the warranty and possibly GAP. Through the finance company or dealership? Would the dealership be able to change

the APR on the loan if she cancels?

Have her check with her insurance company and see if they offer gap. Some do some dont. Could be cheaper.

 

If not, Id keep the gap and cancel the service contract if she doesnt want it.

 

Her monthly payments probably wont change when she cancels any of it. It will reduce the loan amount so she will end up making fewer payments.

 

 

 

Thanks everyone for the info! I guess she will be visiting the dealership this weekend.

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please report back.

 

FWIW IIRC Toyota only has a 3 year warranty... I hope the loan is not longer than the warranty.

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Best thing to do is to refi the loan at a credit union. Credit union will pay off the loan ,then go back to the dealer to cancel the extended warranty . Then she can put the money from the warranty in her pocket. 3k would feel great in my pocket.

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Refinanance an auto loan at or below .09%. I would have my doubts that the same rate or lower would get possible now.

 

Sent from my SM-P580 using Tapatalk

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Refinanance an auto loan at or below .09%. I would have my doubts that the same rate or lower would get possible now.

 

Sent from my SM-P580 using Tapatalk

+1

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