Auto repair loans: What to know and where to find one

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If you are on the hook for unexpected vehicle repairs and don’t have money left to pay them, you can turn to auto repair loans.

Our goal at Credible Operations, Inc., NMLS No. 1681276, referred to as “Trusted” below, is to provide you with the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who compensate us for our services, all opinions are our own.
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If you have a car, you will eventually face an auto repair that is not covered by your vehicle’s warranty or insurance. This can mean a big bill, or being stranded without wheels.

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Without enough savings to cover repairs, you’ll need to find money to get your vehicle back on the road. Auto repair loan is a solution to get your vehicle repaired and running again. Here is everything you need to know about this financial product.

What is Auto Repair Loan?

An auto repair loan is any type of loan that can be used to pay for vehicle repairs – this is generally an installment-based personal loan.

With an auto repair loan, you will borrow cash in a lump sum that you can use to cover your auto repair bills. You will be responsible for repaying the loan monthly for a specific period along with interest at the agreed rate.

You can do this Compare Personal Loan Rates From various lenders in minutes using Credible.

How do auto repair loans work?

While taking a car repair loan, you can expect it to work like any other personal loan. Once approved, your lender will offer personal loan terms. this order how long do you have to repay the loanWhat will be your fixed monthly payment, how much interest will you be charged and whether you are allowed to prepay the loan without prepayment penalty.

Personal loans are generally unsecured. This means that borrowers are not required to guarantee the loan with current assets – also called collateral. But borrowers usually need to have good credit and a steady source of income. to qualify.

Benefits of Auto Repair Loans

If you are facing huge bills from your mechanic, some of the benefits of taking an auto repair loan are:

  • No collateral is required. Unlike many other loan products, personal loans for auto repair are unsecured. you won’t need it keep any collateral – such as your car title, home equity or savings account – to take out a loan.
  • You will get the loan in one lump sum payment. Your lender will provide you with the full loan amount in one go, so you can pay off your repair shop and be on your way.
  • Funding is generally very fast. Depending on the lender you choose, you may be able to get your auto repair loan amount as soon as the next business day.
  • Interest rates are often lower than other products. Personal loan interest rates are generally lower than the interest rates found with credit cards or payday loans. Your actual rate will depend on your credit score, income and loan terms.

How to Apply for Auto Repair Loan

Borrowing money to pay for auto repairs can be a straightforward process. Depending on your unique situation and financial history, it can also be relatively quick.

1. Determine how much you need to cover your repair costs. Be sure to account for things like parts, labor, and any towing charges you may have incurred.

2. Shop around for a lender. Apply for auto repair loans from multiple lenders, or shop through platforms like Credible to get multiple offers in one place. This not only saves you time and allows you to shop around without affecting your credit score, but also tells you how much you can qualify for and gives you the best possible offers.

3. Choose your loan. Choose your lender based on the best loan terms offered to you (such as repayment term, monthly payment and interest rate), and even how quickly you can get your loan amount.

4. Apply. loan application submission Includes a hard credit check, which will temporarily lower your score by at least a few points.

5. Receive your money. Your lender will credit your loan amount to the account specified by you. Depending on the lender you choose, you can get your money on the same or as early as the next business day.

Where to Get Auto Repair Loans

Most banks, credit unions and online lenders offer personal loans for auto repair.

If you already have a relationship with a bank or credit union, you may want to see what loan terms and rates they offer. Otherwise, shopping online can be a great way to get multiple offers at once without impacting your credit score.

reliable makes it easy Compare Personal Loan Rates from multiple lenders.

15 Lenders To Consider For Auto Repair Loans

If you need an auto repair loan, consider these 15 trusted partner lenders.

Earlier

  • Loan: $2,000 to $35,000
  • Minimum Credit Score: 550
  • Funding time: as soon as the next business day

exos

  • Loan: $5,000 to $35,000
  • Minimum Credit Score: 740
  • Funding time: as soon as the next business day

best egg

  • Loan: $2,000 to $50,000
  • Minimum Credit Score: 600
  • Funding time: As soon as one to three working days after successful verification

Discover

  • Loan: $2,500 to $35,000
  • Minimum Credit Score: 660
  • Funding time: As soon as the next business day after approval

Freedom Plus

  • Loan: $10,000 to $35,000
  • Minimum Credit Score: does not disclose
  • Funding time: as soon as two business days

Lending Club

  • Loan: $1,000 to $40,000
  • Minimum Credit Score: 600
  • Funding time: as soon as two business days

lending point

  • Loan: $2,000 to $36,000
  • Minimum Credit Score: 580
  • Funding time: as soon as the next business day

lightstream

  • Loan: $5,000 to $100,000
  • Minimum Credit Score: 660
  • Funding time: same business day

Marcus by Goldman Sachs

  • Loan: $3,500 to $40,000
  • Minimum Credit Score: 660
  • Funding time: usually three business days

OneMan Financial

  • Loan: $1,500 to $20,000
  • Minimum Credit Score: None
  • Funding time: as soon as the same business day (but usually requires a branch office visit)

penfed

  • Loan: $600 to $50,000 (depending on loan term)
  • Minimum Credit Score: 670
  • Funding time: As soon as two to four working days after verification

prosper

  • Loan: $2,000 to $40,000
  • Minimum Credit Score: 640
  • Funding time: as soon as one business day

Sophie

  • Loan: $5,000 to $100,000
  • Minimum Credit Score: does not disclose
  • Funding time: three business days

upgrade

  • Loan: $1,000 to $50,000
  • Minimum Credit Score: 560
  • Funding time: Required verification within one working day of clearing

Nouveau riche

  • Loan: $1,000 to $50,000
  • Minimum Credit Score: 580
  • Funding time: as soon as one business day

When you’re ready to apply for an auto repair loan, use Reliable for Compare Personal Loan Rates in minutes.

3 Auto Repair Financing Options To Avoid

If you need to pay for auto repairs and can’t (or don’t want to) take out a personal loan, you have a few other financing options. But they can be expensive, and you should consider them only as a last resort.

payday loans

  • Short loan repayment terms, often around two weeks
  • Very high fees, which equate to an annual percentage rate of 390% to 780%
  • Low loan limit (anywhere from $100 to $1,000, depending on state regulations)

car title loan

  • Loans are generally limited to 25% to 50% of the value of your vehicle.
  • Your vehicle’s title will be held as collateral
  • Average finance charge that equates to an APR of around 300%
  • Usually needs to be repaid in at least 15 to 30 days

credit card cash advance

  • Usually incurs higher finance charges than regular credit card purchases
  • May also charge transaction fees
  • If you do not pay the balance in full, the interest will be compounded with the next statement cycle


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