Texas GAP Insurance Refunds: Your Rights Under the OCCC
Last reviewed: August 2026
Quick answer: Yes — if you paid off a Texas auto loan early, traded in, or refinanced, Texas law (Finance Code §354.007) requires the unused portion of your GAP fee to be refunded, generally within 60 days of payoff, automatically.
If you paid off a Texas auto loan early, refinanced, traded in, or sold your car, you're likely owed money back on your GAP coverage. Texas regulates GAP waivers under its Finance Code, and the Office of Consumer Credit Commissioner (OCCC) oversees compliance. Here's what the rules say — and how to claim what you're owed.
New to GAP refunds? Learn how a gap insurance refund works, and see how long does a gap insurance refund take in your state.
Key Texas rules
30-day free look for a full refund.
Cancel your GAP waiver within 30 days of purchase and you're entitled to a full refund of everything you paid for GAP, including any finance charges on it. This is the simplest path — no pro-rata math, no cancellation fee.
Refunds of the unused portion after that.
After the 30-day window, Texas rules require the refund to be calculated by a method at least as favorable to you as standard industry formulas — in practice, most contracts refund pro-rata, sometimes minus a small permitted cancellation fee. Texas also doesn't require refunds below a minimal threshold (a few dollars). Example: a 72-month GAP contract paid off at month 36 typically has roughly half its coverage unused.
Automatic on payoff — but don't count on it.
When your loan is paid off in full, Texas law terminates the GAP agreement automatically and requires the refund within 60 days, no request needed. In practice, refunds still slip through the cracks, and for a voluntary mid-term cancellation the holder can require a written request. Either way, a documented written demand is what gets checks moving.
5% price cap on dealer-sold GAP.
Texas caps the cost of dealer-sold GAP at 5% of the amount financed. On a $30,000 loan, that means GAP can't legally cost more than $1,500. For certain agreement types Texas instead sets maximum fees by an official rate schedule — either way, the price is regulated.
The 60-day refund deadline
When your GAP agreement terminates — whether because you paid off the loan, sold the vehicle, or cancelled mid-term — the holder must issue your refund within 60 days (the holder may alternatively instruct the plan's administrator in writing within 30 days, who then has 30 days to pay). If that window passes with no check and no explanation, your claim is overdue and it's time to escalate.
What a typical Texas refund looks like
Dealer GAP in Texas commonly costs roughly $500 to over $1,000 — Texas caps it at 5% of the amount financed, so on a $30,000 loan it can legally run as high as $1,500. Because it's financed into the loan, you're also paying interest on that premium.
Pay off a 72-month loan at month 36 and roughly half the GAP coverage is unused. After any permitted cancellation fee and the de minimis threshold, the refund typically lands in the $200–$500 range depending on what you paid and your exact dates. Use our free calculator for a personalized estimate.
If your refund is denied or ignored
Where to turn depends on who's holding the money:
Lender or finance company won't refund
File a complaint with the Texas Office of Consumer Credit Commissioner (OCCC) at occc.texas.gov. If your lender is a national bank, complaints go to the federal CFPB at consumerfinance.gov/complaint.
The dealer misled you when selling GAP
The Texas Department of Motor Vehicles licenses and investigates dealers.
GAP purchased as part of your auto insurance policy
The Texas Department of Insurance at tdi.texas.gov handles insurance-regulated GAP.
And if we prepared and submitted your claim, our Service-Fee Refund Guarantee applies: a formal denial or no response after our full follow-up process means your $79 comes back.
Frequently asked questions
My loan was paid off and I never got a GAP refund. What now?
Texas law terminates the GAP agreement automatically when your loan is paid in full and requires the refund within 60 days — no request needed. If it never arrived, your claim is overdue. A documented written demand is what gets checks moving, and you can escalate to the OCCC if the holder still won't pay.
Do I need to send a written request?
On a full payoff, Texas law says the refund is automatic. But refunds slip through the cracks, and for a voluntary mid-term cancellation the holder can require a written request. Either way, a documented written demand is the safest approach — it starts the 60-day clock and creates a paper trail.
What if I refinanced rather than paid off?
Refinancing ends the original contract, which terminates the GAP waiver on it — same refund rules apply. The unused portion is owed back to you.
Is my GAP a "waiver" or "insurance," and does it matter?
It matters for where complaints go. GAP sold by the dealer as part of your financing paperwork is a waiver governed by the OCCC and the rules on this page. GAP added to your auto insurance policy is regulated as insurance by the Texas Department of Insurance and is usually easy to cancel with a call to your insurer.
Ready to check your Texas refund?
Our free calculator applies Texas rules to your contract details and estimates your refund in about two minutes.
Not in Texas? See our California GAP refund guide.
Important Notice
This page is general information about Texas law, not legal advice. GapInsuranceRefunds.com is a document-preparation and claim-assistance service, not a law firm. Refund amounts depend on your contract terms, dates, and individual circumstances. Primary authority: Texas Finance Code Chapter 354 (GAP waivers), administered by the Office of Consumer Credit Commissioner (OCCC).
See how your state compares: GAP refund laws in all 50 states.