Consumer Car Buying Advice Blog

The name of the company is Walkaway and among other things it is the company backing the much vaunted Hyundai assurance and assurance plus programs.

Dealer “adds” that make sense

Here at Auto Credit Express, we have always stated that, when purchasing a new or used car, there are many dealer back-end products that are a waste of your hard-earned money. We count among these offerings such things as rust protection, glass etching and paint glazing products. Rust protection is a waste because it could very well void your new car warranty. In addition, if you find that you can’t make do without the last two, you can do both, yourself, at a fraction of the cost the dealer would charge you.

On the other side of the ledger, however, there are a number of additional services that just might end up saving you money in the long run. Two products that come to mind are extended warranty packages and gap protection. Extended warranties can save you from potentially catastrophic expenses, in particular, if you are buying a used car, while gap protection especially useful when you are financing a new car.

GAP insurance

Usually an integral part of most modern vehicle leases, gap coverage is essentially an insurance product. It’s designed to make up the difference between what a vehicle is worth on the wholesale market and the actual amount that is owed on the lease contract in the event the leased vehicle is in an accident and written off as a total loss. This type of coverage is especially important in a lease, because the lessee is never in an equity position with the vehicle – leases are designed so that, at least in theory, the vehicle is worth its residual value only at the end of the lease.

With the advent of longer finance terms and lower down payments, however, gap insurance for retail financed vehicles makes more and more sense – especially given the volatility of the used car market over the past year. A case in point is the SUV. If you bought an SUV – especially a big one – two years ago with no money down on a 72 or 84 month finance contract (or even 60 months, in many cases) and it was stolen or declared a total loss in an accident (your insurance company will only cover it up to its current value less your deductible) you were probably in big trouble. Remembering last summer’s precipitous drop in SUV values, you can see why a total loss could leave you holding the bag for thousands of dollars in negative equity that you would still have to pay back to the bank. In this case, GAP insurance would’ve more than paid for itself.

Hyundai calls it assurance – we call it super gap

But what if some other event, other than an accident or theft, renders you unable to cover that difference in negative equity? Especially given the current economic uncertainty, it would help if this kind of coverage also included coverage against job loss, physical disability or loss of driver’s license due to a medical impairment. It turns out that a company in Texas is currently offering such a product and both are named Walkaway®.

If this gap package sounds familiar, that may be because one of Walkaway’s clients is Hyundai. It turns out that the original “Hyundai Assurance Program” was Walkaway’s 12 month package that includes up to $7,500 in gap protection for 6 scenarios: involuntary unemployment (permanent release), physical disability (with a 60 day waiting period), loss of driver’s license, international employment (permanent for 24 months or longer), self-employed personal bankruptcy and accidental death.

Hyundai later amended their program to include a variation of Walkaway’s “Full Term” plan that adds 90 days of loan or lease payments in the event of physical disability or involuntary unemployment.

The Company

Originally established in Toronto, Canada in 2000, the U.S. division was established in 2007. According to the company web site, “WALKAWAY is the only Vehicle Return Program that protects consumers from financial shortfalls arising from the depreciation of new and used vehicles (negative equity) available only through Authorized WALKAWAY Lenders.”

In addition to the initial program offered by Hyundai that covers the first 12 months (without the 90 day payment provision), the company offers:

• A full term plan that covers negative equity in sales contracts of up to 84 months
• A full term with payment relief (up to 90 days) that covers sales contracts up to 84 months
• A full term $15,000 plan that covers negative equity of up to $15,000 for 84 months (with a maximum financed amount of $75,000)
• A full term $15,000 plan that covers $15k in negative equity and provides two 90-day payment benefit periods (for a total of 6 months) in the event of involuntary employment or physical or mental disability.

Available through dealers and banks

From what we could glean from the web site, the programs, other than Hyundai, are available through car and motorcycle dealers as well as banks and credit unions. We left a message at Walkaway for information concerning other participating dealers, credit unions and banks, but our call was not returned.

The Bottom Line

Here at Auto Credit Express, it seems like the time has come for creative gap programs like Walkaway, especially in today’s uncertain economic climate. As soon as we receive more information on the program, we will present it here.

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