Whether your vehicle needs repairs or you’ve been hit with unexpected expenses, finding financing can be challenging. Borrowers with bad credit can often find loan offers that serve their financial needs if they look for lenders with lenient requirements and compare options.

Personal loans for car repair offer a 200 loan lower risk option than payday and title loans. They also report payments to the credit bureaus, potentially helping borrowers improve their credit scores in the future.

Personal Loans

There are personal loans available to help you pay for a car repair bill. These are unsecured loans that don’t require any collateral, unlike payday and title loans. You can find lenders who specialize in providing car repair loans for bad credit. These lenders may offer competitive rates and terms, and you can get preapproved in minutes. Some of these companies also impose fees, so you should shop around before choosing one.

Typically, you’ll receive the funds in a lump sum once you’re approved, and you’ll pay back the loan through fixed monthly payments. These payments will be deducted from your paycheck until the loan is completely paid off. Some companies will disburse the funds as soon as you’re approved, while others may take a few business days.

While personal loans for auto repairs are available to people with bad credit, you should always compare the options and rates before selecting a lender. You should also be aware that a credit check is typically required for these types of loans, which can cause a temporary dip in your credit score.

Some of these lenders include Lake Michigan Credit Union, which offers personal loans with no minimum credit score and low interest rates. Another option is MoneyMutual, which partners with direct lenders to provide a wide range of personal loan amounts and terms. This company’s minimum credit score is 620, and it offers a competitive APR and no origination fee.

Co-Signing a Loan

As a cosigner, you are legally obligated to pay the loan back in the event of default. As such, you should only agree to cosign if you have the funds available to make payments in the event of a default. In addition, you should have a clear understanding of your rights and responsibilities with the primary borrower. This should include an agreement on how payments will be made and a method for both of you to access the loan account and track progress toward repayment.

Many local mechanics and car repair shops work with lenders to offer financing options for customers. These can take the form of a payment plan, a branded credit card with 0% interest for 6 – 21 months, or a personal loan to cover the cost of repairs. Depending on your credit score, these options can be more flexible than payday or title loans, but they can also carry high interest rates and fees.

If your loved one has bad credit and cannot get a personal loan, consider asking them to apply with you as a cosigner. You should be aware that a hard credit pull will be made when you cosign for the loan, which may temporarily impact your own credit score. However, if you make your monthly payments on time, your credit report will improve, and you could then qualify for more attractive borrowing options in the future.

Store Credit Cards

Many large repair shops, such as Midas or NAPA Auto Parts, offer cobranded credit cards that allow customers to finance their auto repairs. These cards are typically closed-loop credit cards that can only be used at the store, which may make them easier to obtain than traditional personal loans or other types of financing. However, you should still shop around for the best pricing on the work that needs to be done before choosing this type of financing. Additionally, using a credit card to pay for car repair can impact your credit score through something known as credit utilization. This is why it’s a good idea to keep your usage as low as possible.

Asking Your Friends or Family

If you need cash for a major repair, borrowing from family or friends can help. However, this option comes with risks. You’ll need to approach your loved ones with caution and honesty, and it can put strain on your relationship if you can’t repay what you owe on time. If you can, try to avoid this option and instead work towards building an emergency savings fund.

Some lenders offer personal installment loans specifically for car repair financing. These are specialized loans that take into account your unique financial situation. If you qualify, these loans are typically deposited in your bank account the same day or soon after. They can also come with fixed interest rates, which makes it easier to budget your monthly payments.

Alternatively, some auto repair shops and mechanics offer their own payment plans or branded credit cards. These usually have a 0% interest APR introductory period for 6 – 21 months, which can help you save money on the cost of the repairs. You’ll need to make sure you pay back what you owe within the introductory period, however, or you could face high interest rates.

While there’s never a good time for your car to break down, unexpected expenses often come at the most inconvenient times. If you’re stuck without a way to get to work or your kids to school, finding the right car repair loan for bad credit can give you the financial assistance you need to stay on the road.