Financing Auto Repairs

Cars are fine-tuned yet fickle machines, and even with regular maintenance checks, an expensive repair due to mechanical failure or damage from an accident can stall your budget. Putting high-ticket work on your credit card might be your first instinct as you want to get your wheels back as soon as possible, but interest rates on credit cards can double or even triple the cost if you’re unable to pay off your monthly balance. Instead of swiping your card, you might want to consider the following financing options to handle costly auto repairs.

Small personal loans

A small personal loan, which is available through your lending institution, could be the answer to cover auto repairs. The type of loan and the interest rates offered to you will depend on how good your credit history is. No matter which type of loan you choose, be sure that you completely understand the terms of the loan as well as factor in the interest rate and penalty for failing to repay your loan.

Auto repair shop

An auto repair shop that helps you pay your bill may seem a little far-fetched, but some auto repair shops can be a surprising source for money savings and financing options. You’ll have to be inquisitive — ask about coupons, discounts and available payment plans, and perhaps seek out a second estimate, advises

Car warranty

Before you spend a dollar of your own money on a repair, make sure to check your vehicle’s warranty. While the basic limited warranty’s period is somewhat short, select automakers also have long-term powertrain warranties. For example, new Kia vehicles have a 10-year or 100,000-mile limited powertrain warranty.

“New-car warranties typically last at least three years or 36,000 miles, whichever comes first. If you’re within that time period, your repairs should be covered. Even used cars, if bought from a dealership, may have a parts and labor warranty,” according to NerdWallet writer Nicole Arata.

If you’re not sure if your car has a warranty, make sure to consult your driver’s manual or contact your preferred dealership for more information.

Insurance or SBA assistance

According to, if your car repair bill is the result of damages caused by a natural disaster, you might qualify for financial assistance from the Small Business Administration, or depending on your policy, from your auto insurance company. If both of these groups fail you, FEMA could be an option if you are able to fulfill its requirements.

Car repairs can take any driver by surprise and finding a way to cover the cost can be stressful. Whether you choose a personal loan, a payment plan from the repair shop or to find help from your insurance company or in automotive discounts, make sure your choice is well informed and fits your financial abilities. Don’t let how you handle a repair bill curb your financial future.

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