It’s Friday night, you leave work only to find the engine light has begun flashing on the dashboard. Great, you’ve already paid your monthly bills and you’re nearing an empty(ish) bank account, but you need your car to get everywhere. It’s not a great feeling.
But, there’s good news!
You can apply for a car repair loan, and it’s easier than you think. For many people, with high or low credit, car loans can be a smart option for tackling those surprise payments in life.
How does a car repair loan work?
A car repair loan usually works much the same as any other loan. You apply for financing and, once approved, you can qualify for up to $5000 towards repairs. The trick is finding the right lending institution to fit your needs.
What does a car loan cover?
Depending on the level of coverage, a car loan should be enough to cover the estimated damage of your vehicle. How long it takes you to pay back, and how much you pay per month, is determined by the specifics of your loan agreement. As for what it covers, your car loan should be able to pay for the following repairs (amongst others):
- Brake repairs and rim replacements
- Issues with suspension and exhaust
- Engine repairs
What are the types of car repair loans?
There are a few types of car repair loans you can apply for, depending on your credit score, personal finances, and the size or cost of the repair.
A traditional car loan is considered a personal loan. This type of loan typically means that you are allotted the amount of money needed to cover your maintenance cost, which you would then repay over a period of months (or years), with interest, until your loan has been paid off. This type of car loan can be a good option if your work and pay are stable and you have enough certainty to repay your loan in the given amount of time, hassle free.
A payday loan might be a good option if your repairs are small or if you are experiencing bad credit. This type of loan works faster than seeking a personal loan, as approval typically takes 24 hours. It often involves smaller amounts of money, making it easier to pay back, and once you’ve been approved for one, it makes applying for future payday loans even easier.
The benefit for those with bad credit is that your credit history has little impact on your application status. So, if you are really in a pinch, it can be a quick alternative, allowing you to address any auto issues immediately. The one catch with this loan is that it only produces small amounts of money. In the event that you have a much larger issue with your car, you will likely have to go with a different option.
A car title loan works in a similar way as a personal loan. The main difference between the two is that a personal loan requires your credit score for approval; whereas, a car title loan is based on the value of your car. This type of loan can also be good for people with a tighter budget or bad credit scores as there are no pre-payment penalties. You can also expect a longer repayment period than traditional loans and monthly payments that are suitable for almost any budgetary restrictions.
One thing to keep in mind with this type of loan is that you generally have to be the owner of your vehicle, with papers to prove it, and there is a minimum value requirement of the vehicle. If you don’t meet either of these requirements, you will have to find an alternative.
Fortunately, there are always alternatives to solving your car problems!
How can I get a bad credit car loan?
With rising living costs and an unstable economy, many are facing unforeseen financial challenges. Bad credit can seem daunting, especially if you are facing unexpected car problems.
The good news is, it’s easier—and safer!—than ever to secure a bad credit car loan. LendingArch can help you streamline the application process, secure the best car loan rates in Canada for your situation, and get you back on the road in no time. The process is simple. You will be asked about the repairs, your yearly salary, and your monthly budget, which will help to determine an overall picture of your needs and abilities. With this information, and without checking your credit score, you will be pre-approved for a loan rate that suits your maintenance issues and meets the requirements of a good lender.
The benefits of this process include:
- An easy application process, especially for those with bad credit, no credit, or who have experienced bankruptcy
- A flexible payment schedule
- A 24-hour approval period
Learn More Today!
Having a properly functioning vehicle to safely get you where you need to go is something that everyone deserves. At LendingArch, we would love to help you secure a car repair loan, whether you have a low credit rating or even no credit rating. Bad credit car repair loans are easier to get than you think. To learn more, reach out to us at LendingArch.ca for all your auto loan needs!