We understand that car repairs can come at the worst possible time. This is why we work with two different financing companies to help our customers pay for their car repairs if they don’t have the cash outright. In addition to these options, Credit Karma also suggests the following traditional and non-traditional financing options for consumers.
Traditional Financing Options
All financing options come with caveats, and some options are better than others. Credit Karma recommends that if you can take out a personal loan from your bank or credit union to pay for your car repairs, this is the route you should take. The reason why is that the interest rate will be the lowest out of all of the options discussed. In addition, banks will work with you so you can pay back the loan over two years instead of right away. This keeps your monthly payments lower.
The caveat to a bank loan is you must have a tangible piece of property to back up the funding and excellent credit. Not everyone has either or both. In addition to a bank loan, Credit Karma also advises that you can use your credit card to pay for your automotive repairs. In this case, however, it’s important to look at the interest rate that your card assesses every month. You may find that it is as much as 20 percent, which makes paying off the charge nearly impossible.
In this case, Credit Karma recommends that you apply for a low-interest credit card or a card that offers zero interest for a limited time. If you have excellent credit and qualify for the card, it will be much easier to pay off the car repairs because they will not accrue as much interest.
Non-Traditional Financing Options
If you don’t have good credit, you may feel as if you have no options. This is not the case. You can apply with either of the financing companies that we work with directly on our website. You also have the option of taking out a payday loan or a title loan. Credit Karma advises that these options are available for people who have poor credit or no credit at all.
This being said, the financial website warns that these options come with high interest rates and short payback periods. In fact, the interest rate could be as much as 200 percent. It’s important to understand the conditions of these loans before you take one out.
Again, if you do not have the money for your car repairs, apply for credit through the options available on our website.