Car maintenance and repairs are quite expensive. According to CAA, the average car repair cost is $500-$700.
Unfortunately, your car will fail at some point. And body repairs, engine failure, and component failures can dent your budget if you are not prepared.
To stay on top of maintenance, you can buy a used car warranty. This way, you can get the best deals for both bumper-to-to bumper and powertrain coverages in case of an emergency.
That said, you need to consider various methods to best pay for car repairs.
Cash
If you have the funds, cash is the best way to pay for used car repairs. You do not need any approval to borrow money, and you will not pay interest if you have the funds.
Personal Loans
Personal loans are also great options to pay for your repairs. Apply for a loan at your local bank or get one from online applications. Also, you can get a personal loan from friends and family.
A personal loan comes with fixed interest rates that you repay for a specific period. There are two types of personal loans—secured personal loans and unsecured personal loans.
Secured loans need you to offer some collateral such as your house or land. Offering collateral will lower the loan’s interest rate, plus it makes you eligible. But remember, the lender will seize your collateral if you default on your repayment.
On the other hand, you can use an unsecured loan. Here, you do not need to offer collateral for an unsecured loan. But the downside is that you will find it difficult to get such a loan if you have bad or fair credit. Your APR (annual percentage rate) for this loan will be high if your credit score is bad.
Vehicle Service Contracts
A vehicle service contract (VSC) is an optional plan that you can buy from a manufacturer or a third-party provider.
VSCs are an excellent way to cover costly mechanical issues like engine and component replacements. Also, they cover simple fixes. So, it is worth buying a vehicle service contract if you find it difficult to pay for unexpected repairs out of pocket.
Credit Cards
You can pay for used car repairs by applying for an introductory 0.00% APR credit card. In addition, card issuers may offer an introductory 0% APR to entice new customers. Also, you can enjoy card bonuses offered to new customers. Plus, these perks can come in handy for urgent used car repairs.
You can use your existing credit cards to pay for car repairs if you do not have enough money to cover the repairs. The credit on your card is limiting, but it does not restrict some repairs you need to do.
Do It Yourself
You can save a lot of money if you decide to repair your car. You will avoid expensive labor costs if you decide to take the DIY route. For example, some mechanics charge as high as $100 per hour for repairs.
There are several tutorials on YouTube and websites to repair a used car. Buy the required parts from local auto shops or online and you are good to go.
In most cases, it is less expensive to repair a used car than buy a new one. But if your repairs cost you more than the value of your car, it may be time to sell it and buy a new car.
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