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A major car repair, such as the replacement of an engine or transmission, may cost you many thousands of dollars, money that might not be reimbursed by an insurance policy. For better or worse, many millions of Americans need a car to get to work. Consumers with the worst credit scores are frequently the ones who have the most trouble arranging financing when a vehicle emergency occurs. Many folks are doubly troubled when their car breaks down – they face expensive repairs and they may must find alternate transportation so that they can commute to work.
Before you pull out your hair, check out these three ways for those of you with bad credit to get your car back on the road and keep that paycheck coming without interruption.
1. Get A Personal Loan
Use a personal loan website like GET.com to compare the best personal loans for individuals with all sorts of credit. Many are peer-to-peer (P2P) lenders that can accommodate borrowers with low credit scores.
When applying for a loan, a lender will review many factors, such as the interest rate you’ll pay and how likely is it that you will repay the loan. You also want to know that the lender is reputable.
Obviously you want a lender who likely will approve your application even if your credit score is low. Thankfully, some lenders work well for people that have subprime or no credit.
They usually offer a fast online application process and forward the money to your bank account quickly. The smallest loan size ranges from $100 to $2000.
This can go a long way towards paying for a transmission rebuild or engine repair. Here you can compare personal loans to get the best rates.
2. Use A Secured Credit Card
Whether you have little or no credit history, or your credit score is subpar, you might be able to get a good credit card that will provide you with secured credit.
Because you pledge property or keep a bank balance as collateral for the credit available from these cards, sometimes you’ll pay a lower APR than you would for unsecured credit cards.
Some cards offer online alerts, cash back rewards and, most importantly, report your repayments to the three national credit bureaus – Equifax, TransUnion and Experian – so that you can start improving your credit rating.
Use a credit card website like GET.com to compare the best secured credit cards for consumers with bad credit.
3. Get The Right Auto Insurance
Most states mandate that you take out auto insurance, but the trick is to get a good, affordable policy that will pay a substantial part of the costs for major repairs.
It’s too late to shop for insurance when your car is already damaged, so you need to be proactive and find the best policy that you can afford before your vehicle needs repairs. Check our listings of the best car insurance for 2016 to save money by comparing the best insurance plans from different issuers.
