Auto Repair Loan
If you are making payments on a nice car and need money for repairs, you may be wondering how you will be able to afford them. If your car is newer and the cost of repairs does not exceed the value of the car, you can get a car repair loan to cover the costs of fixing it. Car repair loans can be used to pay for expensive car repairs or to cover insurance deductibles and can range from a few hundred dollars to a few thousand. Everyone who owns a car faces a break down at one time or another and being able to fix your car so you can commute to work and take care of other responsibilities is important.
A car repair loan is different from a personal loan because the money is being invested in a vehicle. Usually care repair loans must be to cover repairs that keep the car in running condition but in some circumstances car repair loans can be obtained for other types of repairs especially if a person has good credit.
Even if you have car insurance that will cover the repairs, most policies require you to pay a deductible before they pay for the rest of the repairs. A car repair loan can be used to cover the deductible if you do not have enough cash to pay for it. Car repair loans for the deductible are usually small and can be repaid relatively quickly.
Lenders usually set the terms of a car repair loan based on the current prime interest rate. A borrower with good credit can get this low rate where as a borrower with less than perfect credit will be charged a higher rate. No matter what your credit is it is important to compare the terms from different lenders to make sure you are getting the lowest interest rate possible.
Because loans for car repairs are usually less than a few thousand dollars, they can be paid off within a year or two. It is important to pay off car repair loans as soon as possible to avoid paying more in interest. If the cost of your car payment plus the cost of paying the car repair loan is going to be more than the cost of a new car, you can also look into selling your car and buying a new one. If the cost of paying for repairs does not make you spend more than you would on a new car, then a car repair loan is the best way to ensure that you can get where you need to go.