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Two types of auto repair financing programs offer ways to fix your car when you do not have enough money set aside for emergencies or routine maintenance.
Many of us drive to work to earn an income. A sudden breakdown could mean a day or more of lost wages; the consequences are harsh.
Taking out a loan or charging the expense to a credit card allows you to pay for the service work in affordable monthly installments. However, people with weak borrowing credentials or low income may not qualify.
On the other hand, low-income families are frequently eligible for financial help through public agencies and private charitable organizations. However, funding is often scarce and hard to find.
Auto Repair Loan Programs
Taking out an auto repair loan is the primary way drivers can fix their car when they have no money set aside for urgent needs. Most people do not have enough cash in the bank to pay for an unexpected and routine vehicle service expenses.
However, many finance companies do have the funding to pay the service center in exchange for your promise to repay them in monthly installments that include interest charges and other fees. Choose the loan option that gets your car running again with the fewest hassles.
Request an emergency auto repair loan here. Yes, they do exist and can help get your car back on the road quickly when you have no money set aside. Repay the lender in equal monthly installments until you retire the obligation.
Drivers can often obtain a fast approval for an unsecured contract because they avoid the time-consuming paperwork requirements associated with verifying the value of pledged collateral such as the vehicle title, or home appraisal.
Unsecured emergency loans rely on your signature promise to pay only. If eligible, online third-party lenders can deposit money directly into your bank account within a short period. These factors help your cause and speed up the process.
- Income from employment
- Employer contact information
- Bank account and routing number
- Verify your identity
- Enable the lender to wire money
- Permit monthly drafting to ensure prompt payment
Bad Credit Loans
Bad credit loans with monthly payments are an auto repair financing option for people with adverse history appearing on their consumer report. Monthly payments allow you to pay for the mechanic’s work in installments instead of one large lump sum of money that you do not have.
However, adverse history, such as late payments, hurt your FICO score, which predicts your likelihood of being delinquent and or defaulting on future loans. Lenders shy away from approving high-risk applicants and charge more (larger origination fees and higher interest rates) if they do.
Therefore, bad credit borrowers should follow a two-part strategy to find a willing finance company offering reasonable terms.
- Keep the projected debt-to-income ratio at an affordable level. Lenders may overlook a poor history if you have sufficient income to support the new installment payments.
- Submit a single request to an online lead company that markets your credentials to a broad network of specialty lenders, who work with consumers with poor credentials.
No Credit Check Loans
No credit check loans are an auto repair financing alternative for drivers with little or no history appearing on their consumer report, as well as those with a negative record. The companies in this category do not pull reports supplied by Equifax, Experian, or TransUnion or use FICO or Vantage scores.
Instead, no credit check lenders use reports supplied by second-tier bureaus that focus on non-traditional data. The non-traditional information might include apartment rental, utility (gas, electric, cable), or cellular bill payment history. The hard inquiry does not display on reports from Equifax, Experian, or TransUnion because another bureau provides the file.
Young adults without a traditional credit history find the no credit check alternative attractive. They often have a financial footprint. However, the traditional bureaus do not recognize them yet, whereas these other agencies do.
Auto repair credit cards are a financing option for drivers wishing to maintain their vehicle in good operating condition over time. Many vehicle service centers and dealerships offer branded credit cards with many attractive features designed to keep bringing you back for scheduled maintenance, and unexpected breakdowns as the miles pile up on your car.
- Steep discounts on service work as a signup bonus
- Zero percent promotional interest rates
- Early notice on deals for tires, oil changes, brake jobs, etc.
However, these branded credit cards also have a dark side that consumers should know before taking the plunge.
- Revolving accounts feature flexible minimum monthly payments that allow interest charges to compound and swell balances over time
- Zero percent introductory rates may include deferred interest that applies if you do not retire the balance by the end of the promotional period
Finally, third party banks such as Synchrony and CFNA issue and manage the private label credit cards – not the automotive maintenance brand itself such as Toyota, Firestone, Midas, Goodyear, Tuffy Tire, etc.
Looking for an auto repair shop that offers payments plans in your local area places the attention on the wrong element. Your focus should be on finding an honest, reliable mechanic or body shop that will fix your car right the first time. Therefore, find a shop that is good at these things instead.
- Diagnose the mechanical problems correctly
- Make appropriate maintenance recommendations
- Prepare an accurate estimate of the cost
- Replace broken or worn out parts
Most shops do not employ banking experts who know how to run a payment plan profitably. It makes little business sense to offer this service when third party finance companies specialize in installment lending (see Synchrony and CFNA above as examples).
Financial Help with Car Repairs
Financial help from government agencies or charitable organizations in another way to pay for car repairs when you have no money. Unfortunately, finding monetary assistance when you are in a hurry is hit or miss at best. Plus, scarce resources cannot support everyone with a need.
A roadmap may have you arrive at your destination more quickly.
Emergency car repair assistance may be the most difficult to find because of the fast turnaround requirements. Unfortunately, most organizations offering financial aid want plenty of information so they can allocate scarce resources to the most deserving people.
Finding charities and agencies that can lend a helping hand and then filling out the extensive paperwork is time-consuming. However, a long-drawn-out process does not mesh well with time-sensitive needs.
Requesting an emergency repair loan may provide a faster answer. Borrowing money is not free. You must repay the lender with interest. However, you can get your car back into operating shape while you research places that might help with future maintenance needs.
Government programs offering direct assistance with car repairs will be difficult to find. Federal agencies do not provide grants (free money) to individuals with specific needs. Instead, grant money flows to universities, state agencies, and non-profit organizations.
However, several recipient agencies may provide indirect help using slightly different labels.
Department of Human Services (DHS)
The Department of Human Services (DHS) offers cash assistance and other forms of financial help for vulnerable groups of individuals in many states. Each state DHS agency runs unique programs targeting a variety of needs.
Programs offering help exclusively with car repairs is rare. Most state DHS agencies administer the Temporary Assistance for Needy Families (TANF). This welfare program provides cash benefits for food, clothing, shelter, and other needs. The government encourages welfare recipients to work to become self-sufficient. Therefore, families can use a portion of their welfare money to fix a motor vehicle needed to commute to work.
Department of Motor Vehicles
In many states, the Department of Motor Vehicles (DMV) offers emissions-related vehicle repair assistance. In others, a different government agency may administer a similar program.
- Money for smog-related maintenance
- Incentives to retire a gas-guzzler
Finding programs offering car repair assistance to low-income families requires some detective work and plenty of persistence. The public entities have more resources but rarely provide direct support for vehicle maintenance (see above as most government programs have income-based eligibility requirements).
Private charities and faith-based ministries are often better for direct vehicle repair assistance. Low-income families should research the local organizations offering to help in this area. Each entity targets the population segment most important to its mission.
- Veterans find help from other retired servicemen and women
- Senior citizens on fixed retirement incomes can find discounts
- Disabled people collecting SSI or SSDI benefits can find help with vehicle modifications
The number of entities, the individuals they seek to help, and the geographies they cover are too numerous to list in this article. Other online resources do an excellent job of compiling these data.
- Working Cars for Working Families provides a geographic database
- Angie’s Angel Help Network also lists a variety of resources
Single mothers can often find auto repair assistance from their local church or faith-based ministry. People of both Christian and Jewish faith have a special heart for women struggling by themselves because scripture urges them to support this vulnerable group.
These Bible verses urge backing for modern-day single mothers.
- Deuteronomy 24:19 When you are harvesting in your field, and you overlook a sheaf, do not go back to get it. Leave it for the foreigner, the fatherless and the widow, so that the Lord your God may bless you in all the work of your hands.
- Psalm 68:5 A father to the fatherless, a defender of widows, is God in his holy dwelling.
- 1 Timothy 5:3 Give proper recognition to those widows who are really in need.
- James 1:27 Religion that God our Father accepts as pure and faultless is this: to look after orphans and widows in their distress and to keep oneself from being polluted by the world.