How Does Auto Repair Financing Work?

Paying for car repairs can be a costly endeavor, and not something anyone looks forward to. They typically arise when you least expect, and for many, the cost is a huge hit to the bank. As a result, many people put off getting their car repaired, which often leads to stress and, in some instances, more problems down the line. This in turn can lead to even great financial hardship. Besides putting the repairs on a credit card and throwing yourself into credit card, getting an auto repair loan is one of the best ways to prepare for unexpected car repair bills.



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Auto repair financing is simply the process of taking out a small loan to pay for auto repairs. While many banks will provide you with the money necessary to pay for these services, many won’t due to the small size of the loans. This is where auto repair financing companies come into play. These are companies that provide the driver with a loan to pay off the car repairs. This in turn means that, once the repairs have completed, you will need to make monthly payments to pay off the loan. Many financing companies give you upwards of a year to pay off your loan, though this typically includes paying interest as well.

To get auto repair financing, all you have to do is find an auto repair financing company you wish to work with, fill out an application, and wait for approval. Once approved, you will receive a list of authorized mechanics to whom you will take your car. You place a down payment, and the financing company takes care of the rest. Eventually you will get a bill in the mail for your loan telling you how much you need to pay off per month. Many auto repair financing companies will only finance a certain amount of money, with many not going below a certain amount, such as $500.

Before choosing an auto repair financing company, you should make sure they’re not only willing to handle your claim, but also that they’re a legitimate financing company. Do plenty of research, and especially seek out past customers who can vouch for their credibility.

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Posted on June 26, 2012 at 9:00 AM