AAA: Drivers faced with $600 car repair costs after pothole damage — compare your financing options

America's crumbling infrastructure is felt by drivers across the country who are faced with unexpected car repairs, according to a recent survey from AAA. Potholes caused $26.5 billion worth of damage in 2021, leaving about 1 in 10 drivers to cope with an average repair cost of $600.

"When a vehicle hits a pothole with any kind of force, the tires, wheels and suspension get the brunt of the impact and fixing any of those items is pricey," AAA Director Greg Brannon said.

While potholes are often impossible to avoid, AAA offers tips for saving your car (and your wallet) from the impact of pothole damage:

• Check your tires. Regularly monitor your tire pressure and tread depth to minimize the impact of uneven roads. You should also keep an eye on your alignment, being sure to keep up with routine maintenance.
• Scan the road for potholes. It's important to note that potholes may be disguised by standing water and puddles. Safely reduce your speed, as running over a pothole at higher speeds increases the chance of more severe damage.
• Look out for warning signs. After you hit a pothole, listen for any new noises and feel your steering for unusual vibrations. Bring your car to a trusted mechanic to determine if you need repairs.

If you're faced with unexpected repair expenses after pothole damage or another type of collision, keep reading to learn about your financing options. You can also visit Credible to compare a variety of financial products, from 0% APR credit cards to emergency personal loans. 

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How to pay for unexpected car repairs

Pothole damage can put a dent in your bumper and your wallet. When you're faced with unexpected auto repairs, it's ideal to pay in cash. This ensures you won't have to pay interest charges or late fees, which can add to the overall cost of the repair.

Still, only about a third (36%) of Americans could cover a $400 emergency expense using cash, according to the Federal Reserve. More than a quarter (27%) would need to borrow money, whether by using a credit card, taking out a bank loan or asking a friend or relative for help.

If you're stuck with an auto repair bill you can't afford, here are three financing options to consider.

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Seek out buy now, pay later options

Buy now, pay later financing (BNPL) allows you to break up large expenses into smaller installments that you repay over time. Some BNPL providers offer zero-interest options, but read the financing agreement in full to get a full understanding of any interest charges or late fees that may be assessed.

Call several auto repair shops in your area to see if any of them partner with BNPL companies like Affirm. Some mechanics may offer low-interest or no-interest financing through a credit card like Synchrony Car Care. Just be sure to adhere to the payment agreement to avoid racking up deferred interest charges.

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Utilize a 0% APR credit card

Some credit card companies offer introductory 0% APR promotional financing that can last for up to 21 months after applying for a new card. This may effectively give cardholders the opportunity to pay for auto repairs without paying interest, as long as the bill is paid in full during the promotional period. If not, you'll be charged regular purchase APR on the remaining balance.

Keep in mind that zero-interest credit card offers are typically reserved for applicants with very good to excellent credit, defined by the FICO model as a credit score of 740 or higher. You should also be aware of any annual fees and late fees that come with the card.

You can visit Credible to compare 0% APR credit cards for free without impacting your credit score.

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Borrow a fixed-rate personal loan

A personal loan is a type of unsecured, lump-sum loan that you repay in predictable monthly payments at a fixed interest rate. Since these loans don't require collateral, you can use the funding however you see fit — including to finance car repairs.

Personal loans offer fast funding, and lenders may deposit the amount directly into your bank account as soon as the next business day after loan approval. But keep in mind that you'll pay interest, which adds to the overall cost of borrowing. Still, personal loans typically offer lower interest rates than credit cards, Fed data shows.

It's important to note that borrowers with good credit will see more favorable loan offers than applicants with bad credit. You can browse current interest rates in the table below, and use Credible's personal loan calculator to estimate your repayment terms.

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Have a finance-related question, but don't know who to ask? Email The Credible Money Expert at moneyexpert@credible.com and your question might be answered by Credible in our Money Expert column.