What dealer add-ons really cost

An add-on bought with the car is usually added to the loan, so it costs its price, any tax on it, and the interest on both for the whole term. Take a $32,700.00 car with $5,000.00 down, financed at 5.90% over 60 months (Texas, with the car registered in Harris County). Adding service contract (extended warranty) at $2,495.00 and GAP at $895.00 ($3,390.00 together) adds $3,390.00 to the out-the-door price, with no tax on it, $65.38 to the monthly payment and $3,922.83 to the total paid once the interest is counted. Adding protection package at $1,495.00 instead adds $1,588.44 to the out-the-door price, $93.44 of it tax, $30.64 to the monthly payment and $1,838.09 to the total paid once the interest is counted.

In Texas, the calculator works the tax from this list. Taxed: the vehicle price, accessories fitted before delivery and protection packages. Not taxed: other dealer fees on the order, loose items sold with the car, service contracts, GAP, prepaid maintenance and government fees. Depends on the deal: the doc fee. The calculator applies the rule of the state you pick, and each add-on is its own line on each deal above.

statutes.capitol.texas.gov · checked Oct 2, 2026

GAP covers the gap between what your car insurance pays if the car is totalled or stolen and what you still owe on the loan. It matters most when the loan is larger than the car is worth: little down, a long term, or negative equity rolled in. When you owe less than the car is worth, there is no gap to cover.

A dealer sells it as an add-on, usually financed with the car. It is also sold by many car insurers as a coverage on your policy, and by many credit unions and banks with their loans. Prices and terms differ by seller, so the figure to compare is each one's price, what it covers and whether it can be cancelled for a refund.

A service contract, often sold as an extended warranty, pays for some repairs after the maker's warranty ends. It is a separate contract with its own price, coverage, deductible and company that pays the claims, and it is not the maker's warranty. The dealer sets its price, which can be asked about like any other line. Many can be bought later, before the maker's warranty runs out, and from sellers other than the dealer.

Service contracts, GAP and protection packages are products sold with the car, each with its own price. If one is on the buyer's order and you did not ask for it, you can ask for it to be taken off before you sign, and ask the lender, in writing, whether its approval depends on it. A payment quoted with add-ons folded in is one the payment check can take apart.

After you sign, many service contracts and GAP contracts can be cancelled for a refund of the unused part, sometimes less a fee; the contract's cancellation section says how. A refund on an add-on that was financed usually goes to the loan rather than to you. If you think an add-on was added without your agreement, you can tell the Consumer Financial Protection Bureau at consumerfinance.gov/complaint.