Perhaps all car owners have paid for a car repair at some point in their life. It is simply inevitable that a vehicle will be damaged from regular use. And this is a serious financial affair as car repairs can cost anywhere from Â£ 300 to Â£ 3,000.
If you need your car on a regular basis for work or other important matters, you have no choice but to pay the price.
Of course, there are several ways to finance the cost of your car repair. One of the most popular options is a car repair loan. Let’s find out what you need to know before getting a car repair loan.
Options for financing your car repair
There are several ways to cover the cost of your car repair. You can opt for either a secure online payday loan, a credit card, or an overdraft facility.
Online Payday Loans
An online payday loan gives you instant cash when your car needs repairs. If you really want to have your car repaired, this is a good financing option despite the high interest rates.
Yes, the interest rate on an online payday loan can be expensive, but there is a cap set by the Financial Conduct Authority to ensure you don’t pay double the amount borrowed.
Look for a credible payday loan provider who follows FCA rules. You can read reviews or testimonials online or visit the website about the lender. Before signing a contract, check for any documents or evidence that the lender is working legally.
Using your credit card is another way to pay for the cost of repairing your car. This alternative is especially useful when you are out of town and your car suddenly breaks down. If you don’t have enough cash in your pocket, you can use your credit card to pay in the workshop.
If you’ve ever tried using an overdraft facility, you can call your bank and ask for an increase in your credit limit so that you can withdraw money to cover the cost of your car repair. A current account loan is just convenience and allows for on-time payments.
Car Repair Loan: Your Best Option
Yes, you can get a loan specifically for car repairs. The amount of credit the lender provides to you is strictly limited to the cost of repairing your car. Usually it has a repayment period of 30 to 90 days. If you can’t repay your debt in the allotted time, the lender can repossess your car.
Since it is a secured loan, you can apply for this financing even if you have poor creditworthiness. It’s not like personal loans, which require good to excellent credit ratings in order to borrow money. A car repair loan lender will send you the money you want to borrow straight to your bank account once you get approval.
Car repair credit insurance
As the name suggests, the money that you can get through a car repair loan is used to pay the amount needed to get your vehicle repaired. In addition to the actual repair, you can also use it for maintenance or service work such as tire checks or tire changes. Maintaining the car is important to make sure it works smoothly on the road and prevents breakdown.
You can also find auto repair loan providers that offer auto protection plans and breakdown assistance programs. Sometimes they also provide cash for vehicle upgrades.
Lenders vary on the loan amounts that they provide. But when it comes to auto repair loans, you can borrow up to $ 5,000.
Tips in Finding a Car Repair Loan
When looking for a good car repair loan, make sure that you are getting a loan from a credible lender. It is also crucial that it offers you advantages. For example, some auto repair loan providers offer 0% interest if you pay off your debt within 30 to 90 days.
It is also advisable to find a car repair loan that offers flexible repayment options. The lender should take your income into account when setting the loan repayment deadline. More importantly, the amount of credit the lender provides must be enough to cover the cost of the car repair.
Finally, you should look for a lender who will approve your loan application quickly. It’s important because you can’t wait too long to get your car repaired.
Do car insurance companies cover the loan costs for car repairs?
Sometimes it takes a long time for auto insurance companies to cover an insured person’s damaged car claims. If that person takes out a loan to cover the cost of the car, the insurance company can pay the main amount of the loan when the claim is closed. However, the interest and fees on the loan may not be covered by the insurance.
Therefore, you should inquire about this with the insurance company. After all, insurance companies differ in their policies.
Getting a car repair loan can be a great option if your car is damaged. This loan can provide you with instant cash to help you out Repair costs. Just make sure that you know how to choose a good lender for that matter.