When a vehicle runs smoothly, it can be a joy to drive. But if your car or truck breaks down on a regular basis, or your mechanic suddenly informs you that you need to get some major work done, vehicle ownership becomes less of a blessing and more of a curse.
The question is, what should you do about it?
Making the Smart Choice
Apart from your house, your car or truck is likely the most valuable physical asset you own. If something goes wrong with it and the vehicle requires significant repair work, it can be easy to shift into panic mode.
Before you make any rash decisions about repairing or replacing the vehicle, however, do some research and develop a game plan. Below is some advice on how to proceed.
- Get Multiple Opinions
Any time you’re faced with a major repair — on a car, house, or anything else of considerable value — it’s wise to gather opinions and estimates from multiple professionals. You could be surprised by how different each expert’s analysis of the situation can be.
One mechanic may suggest replacing the entire engine, while another will declare a good cleaning will be sufficient. A third motor repair expert might advise you only to replace a piston.
Furthermore, each person may quote a different price. Even if they all recommend the same work, one might charge 25 percent less for an identical job. If all other factors are equal, that can be a significant variance!
The lesson here is to seek multiple opinions. For a major repair job, three diagnoses with estimates should be the bare minimum you obtain.
Once you have this information in hand, you’ll feel far better informed, and ready to make a smart decision.
- Run the Numbers
Once all the estimates and opinions have been gathered, and you can compare them against one another, you should be ready to crunch the numbers and decide which option is best. The first thing you’ll need to do is estimate the value of your car after the repairs versus without them.
For the purposes of illustration, let’s say your vehicle is worth $5,000 without the repairs and will be valued at $10,000 after the work gets done. If you’ve been quoted $2,000 for the repair, then it makes sense to get it done.
Even if you turn right around and sell the vehicle, you’ll come out $3,000 better off. If, however, the repair looks like it’s going to cost $5,000 or more, it’s probably not worth the trouble. You’ll end up losing time as well as money on the deal.
Some people suggest using the 50 percent rule of thumb. It states that if the repairs exceed 50 percent of the total cost of replacing the vehicle, you’re better off replacing.
Thus, for example, if it would cost you $10,000 to replace your car with a comparable vehicle, it’s not smart to pay for any repair work that would exceed $5,000. Anything under this threshold might make sense (although you may want to take other calculations into account).
- Weigh the Intangibles
It’s not all about money. You may also need to weigh some intangibles.
For example, if you decide to replace your vehicle, you’ll have to take the trouble to list it, negotiate a sale price, find a replacement, and haggle over the purchase price on that car or truck. You’ll also have to go through the process of switching tags, adjusting the title, and paying taxes through the local Department of Motor Vehicles.
If you’re on the fence about whether to repair or replace, some of these time-consuming necessities may inspire you to repair.
- Consider All Your Options
You nearly always have more options than you realize. If your vehicle doesn’t run, for example, you could still get some value out of it by selling it for cash to a company that will use it for scrap metal. Not only can this put some money in your pocket toward a new vehicle, but it saves you plenty of time and effort.
It’s also worth considering whether the repair is something you could do on your own. If it’s something fairly simple, like replacing brake pads and rotors, you might be surprised how cheap and easy it can be to take care of it in your own driveway.
Push Past Emotions
Much like homes, cars are special because of the way they can stir up our emotions. The decision to repair, sell, or purchase a vehicle can be a difficult one.
If you aren’t careful, you can make a poor decision in the heat of the moment. As hard as this can be, you have to learn to push strong feelings to one side and make an objective decision based on solid facts.
Clarity is vital … and you won’t achieve it if you let your frustrations get the better of you.