We all know how much of a hassle is getting your car repaired? More so, they come up unexpectedly and you are short on cash. How many of you have faced this situation in the past? But don’t worry, you’re not alone, and there are ways to manage the costs. If you need to pay for car repairs, this guide can help you understand how to get a car repair loan.

Owning a car comes with its fears, like finding yourself with a car that won’t start in your driveway or one that breaks down on the road with lots of warning lights flashing on the dashboard. When this happens, the first thing you usually wonder is, “How much will this cost?” Learn about the benefits of using car repair loans to finance expensive repairs your vehicle needs in Ontario, and how Pearlcorp can help with this.

What is a Car Repair Loan?

A car repair loan is a special type of loan used to pay for costly car repairs. Many drivers, especially in the Ontario Area, don’t have enough money saved to cover big or urgent repairs. Some people might have the money, but paying for repairs all at once could mess up their budget. Instead of using a credit card or a line of credit, a car repair loan offers car owners the funds and flexibility they need to handle their repair bills.

What Are The Benefits of Using a Car Repair Loan?

Car repair loans in Ontario come with several advantages. Deciding to get one depends on your situation. Here are some benefits that you might find useful:

1. Car Repair Loans Make Repairs Possible

Many Canadians can’t pay for necessary car repairs without a loan because these repairs can be quite expensive. Not everyone has thousands of dollars available to handle these costs immediately when needed. Although there are other ways to finance these expenses, not everyone can use them.

2. Car Repair Loans Often Come With Better Rates Than The Alternatives.

Other ways to pay for car repairs include using credit cards or lines of credit. Although many Canadians have credit cards, these cards may not have high enough limits to cover expensive repairs like fixing an engine or transmission. For example, if your credit card has a limit of $5,000, it might not be enough for a major repair.

Even if you can charge the full cost of the repair to your credit card, it’s usually not a good idea because credit cards often have very high interest rates, like 19.5%. Instead, a car repair loan might offer a lower interest rate, making it a cheaper option.

While lines of credit generally have lower interest rates than credit cards, not everyone qualifies for one. And even if you do have a line of credit, the interest rate might still be higher than what you could get with a car repair loan.

3. Vehicle Repair Loans Can Help You Keep Track Of Your Spending.

Getting a car repair loan can help you manage your money better. If you just add your car repair costs to a line of credit that you use for other expenses, it can make your finances messy and confusing. Plus, you might end up paying more in the long run because of the interest rate on the total amount you owe. A separate car repair loan could make things clearer and potentially cheaper.

Can you finance car repairs? 

If your car suddenly needs urgent repairs today or tomorrow, are you ready to pay the large amount of money, possibly hundreds or even thousands of dollars, to fix it? For most people, the answer is no.

Luckily, there are different ways to pay for emergency car repairs so you can drive again.

With a car repair loan, you don’t have to pay all the money at once, which is helpful since you might need that cash for important expenses like rent or groceries. This way, you can fix your car without stressing your budget too much.

Should you use a credit card to pay for car repairs?

Before you think about getting a car repair loan, it might be a good idea to put your credit card away. It can be tempting to use it to fix your car quickly, but this could end up costing you more because of the high interest rates and the need to pay back quickly.

Credit cards also make it easy to fall into a lot of debt, especially if you use them for expensive things like car repairs.

Instead, you might want to consider a car repair loan. These loans can often be approved within a day or two, which means you won’t be without a car for long. This option can be more manageable financially.

Secured vs. unsecured car repair loans

When looking at car repair loans, you’ll find there are two main types: secured and unsecured loans. It’s important to know the difference between them before you decide.

A secured loan requires you to put up something valuable, like your house or car, as collateral. This means if you don’t keep up with the payments, you could lose that item. However, secured loans can be easier to get if you have bad credit and they usually have lower interest rates.

An unsecured loan, on the other hand, doesn’t require any collateral. This is safer because you won’t risk losing your property if you fall behind on payments. But, since there’s no collateral, these loans typically have higher interest rates. You’ll need to think about whether you can handle the higher cost.

Contact Pearlcorp To Learn More About Car Repair Financing

If you need a car repair loan in Ontario, Pearlcorp can help! We’ve assisted many clients in getting the financing they need to fix their cars. We can explain your options for car repair financing and help you secure a loan.

To schedule a service appointment for your car, please click here. Contact us through our website if you have any questions about car repair loans or about our other products and services.