Where do you draw the line with car repairs? That is an excellent question, and one that is asked on a daily basis at my shop. I constantly run up against this quandary, and finding the solution can be tough. There are many variables in this equation, and the outcome can become a delicate balancing act. Let’s go over a few of my experiences and maybe help you determine when it’s time to give up on repairs and start scanning Autotrader.
I have been repairing vehicles for the better part of twenty years. I have experienced far too many eye-opening situations where not only did a customer go too far with repairs, but I, as a shop owner, foolishly allowed them to. I never imagined in my early days of mechanic training that my career would not only focus on fixing broken cars but also serving as a financial counselor for the cost of vehicle repairs. Think about that for a minute. Your mechanic’s role is to properly repair your car, and you trust them to use your money wisely. Here are two scenarios from beginning days of wrenching to give you an insight into my thinking.
A customer brought in a 2000 Ford Taurus with a slipping transmission. I diagnosed the issue and found that a replacement transmission was in order. Keep in mind that this was in my early days as a mechanic. Now, this vehicle was worth about $2,500.00 at the time. However, the repairs totaled more than $3,000.00. The customer gave full approval for the job. I got the car fixed and sent her on her way. She was a very happy lady for months to come — until one day, when I received a call. It was filled with many, many curse words and yelling. I calmed her down and asked what the problem was. She was able to relay to me that someone had hit her car and totaled it. The other drivers insurance was going to pay book value for the car — $2,400.00, which was a fair value and roughly what she paid for it a few years earlier. She continued to barrage me with insults on how she was into this car for over $6,000.00! Here is the kicker for me. She then commented, “If I had only known this, I’d have NEVER had the transmission replaced that YOU recommended.” I gulped with great amounts of remorse, because that’s not the kind of mechanic I was. I learned my lesson. There is indeed a definitive line that one can go too far beyond with repairs, and I needed to help customers see that line.
A customer brought me a 2004 Ford F150 with a loudly clacking 5.4-liter V8. It was diagnosed and would need a new engine. He tells me he had only owned the truck a few months, it had been making that noise when he bought it, and he still owed a significant amount to the bank. He reasoned that he couldn’t sell the truck in that condition and get enough to pay off the loan, so making the repair was his best option. His bank allowed an extension on the loan for the $7,000 needed to replace the engine. So, with a green light on the job, I replaced his engine with a new unit and sent him away a happy man. Six months, later I received a call from his bank. The truck had been stolen and found its way to a chop shop. The truck was literally gone. The bank wanted copies of all repair invoices. By then, the owner was about $12,000.00 into an initially purchased $5,500 truck. Insurance paid out the book value of $9,000.00, but left the owner with $3,000.00 to pay. More than half of what he paid for the entire truck! He took a risk on an unbelievably “cheap” truck and lost in the end. I felt so horrible in this situation.
Long story short here: I will no longer perform repairs on a vehicle that will exceed the value of the car. No exceptions.
Doing the Math
Now, we get into the ratios and math needed to decide when it’s time to call it quits and shop Autotrader for another car.
If you currently own your vehicle and have it at a shop for repairs, the cost of repairs should never exceed the value of the car. The reason for this is simple math. You can replace the entire vehicle for that cost. Also, if you find yourself in a wreck, your insurance will care less about your repairs. They will only pay out the book value of the vehicle. Nothing more. You lose the rest out of your pocket, plain and simple. I have also run up against the idea that fixing a vehicle is cheaper than buying a brand-new one. You have to keep in mind that we are talking about the current car you own, not a brand-new one. You should never exceed the car’s value in repairs. Ever. Even getting to 80% of the value is very risky.
I have helped many, many customers over the years steer away from these risky situations. It is very likely that the money spent on repairing an older vehicle can easily go toward a large down payment on a newer model with no issues and fewer miles. Make sure you keep all repair invoices and keep a tally on all repairs. Those small repairs can easily add up, and you just might find that you’re already further into that car than you would like to be. If faced with a decision like this in the future, don’t try to hold on to the car. As much as you love your car, it just can’t run forever. Instead, the next step is to head to Autotrader and start browsing. Trust me, you will thank me in the end. Many already have and continue to do so.
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