Expensive car repairs are an unfortunate part of car ownership for many drivers. They also tend to be unexpected. If you’re facing an emergency car repair, it’s easy to feel overwhelmed and worry about how you’ll pay the bill. The good news is, you might be able to finance your repairs with auto repair loans. Read on to learn more about these loan options and find the best solution for your repairs.
Get up to $500* for car repairs. (Or anything else.)
Emergency auto repair loans offer financing for car repair bills. Essentially, you borrow money from a lender to pay for the repairs made on your car. Then, you pay back your lender over time.
The loan amount, length of term, monthly payments, and interest rate can vary between loan lenders. Some common lenders who offer car repair financing include:
Most car repair loans are a type of personal installment loan, which is different than a payday loan.
Payday loans are short-term loans with a single repayment date based on the day you get paid. They tend to have very high interest rates and fees, and can easily lead to a cycle of debt.
Personal loans and installment loans for auto repairs give you the chance to repay your loan over time.
For example, Possible Finance offers installment loans for auto repairs. You can apply for up to $500 which can be paid back in four payments.
Worried about less-than-perfect credit? Possible Finance doesn’t check your credit score when determining your eligibility for a loan.
You may be asking: Can I get a loan to repair my car if I have bad credit? Yes, you can get auto repair loans with bad credit, just like any other bad credit auto loan.
Bad-credit loans are usually personal or installment loans. Lenders who offer these loans often specialize in lending to bad credit borrowers.
However, make sure to weigh the pros and cons of car repair loans for bad credit to make sure they’re a good fit.
Advantages to bad credit loans include:
However, bad credit car repair loans aren’t a perfect solution.
Consider these drawbacks before signing up for loans for borrowers with bad credit history:
What can you do if your car needs repairs right now? Emergency car repair loans let you cover unexpected repairs.
Credit cards, payday loans, and repair shop payment plans are common types of emergency repair financing.
Like bad credit loans, emergency repair financing has benefits and drawbacks. You might consider an emergency auto repair loan because:
Emergency auto repair financing may not be the best fit for your situation, however.
Drawbacks to emergency loans include:
Emergency repair loans and loans for bad credit aren’t the only options if you’re facing a car repair bill.
Auto repair loan alternatives give you more options to customize your financing to meet your financial situation.
Before you decide if you should get a loan to repair your car, you have to decide if it’s worth repairing. Cars don’t last forever, after all.
You might be better off trading in your car and getting a loan to buy a new (or new-to-you) vehicle, instead.
How should you decide if it’s better to trade in for a new car or repair your current one?
Start by looking at the benefits and disadvantages of each.
Benefits of New or Reliable Used Cars:
Disadvantages of Purchasing a New Car:
Benefits of Repairing Your Existing Car:
Disadvantages of Repairing Your Car:
Remember that buying a new car is a big financial decision. You don’t want to rush into it.
Everyone’s financial and repair situation is different. A good place to start is to compare the cost of repairs with the value of your car.
You can use resources like Kelley Blue Book to estimate the current value of your car.
For example, your car needs a new transmission and the mechanic’s shop quoted you $5,000 to replace it.
You look up the value of your car by comparing it to others for sale in your area and Kelley Blue Book guides.
The current value for your vehicle in good condition is $3,000. This means the repair costs are more than the car might be worth.
Of course, this doesn’t mean you should rush out and buy a new car. The value of your car versus the repair costs is just one factor in determining if you should repair the vehicle.
If you drive a car, there’s a good chance you’ll face auto repairs at some point. Whether you need expensive maintenance work or an emergency repair, auto repair loans could be an option.
Make a plan before you choose how you’ll pay your auto shop. Consider all of your financing options to find what works best for you.
You should aim to cover your car repairs with a loan that sets you up for future financial success—not one that encourages you to take on extra debt.
Don’t let your auto shop pressure you into a financing option that doesn’t fit your situation.