Repairs or Total Loss?
My wife and I just received an estimate from our insurance company regarding the damage to her car. The adjuster mentioned that it’s nearly totaled, giving us the option to either total it or proceed with repairs—unless further damage is uncovered by the auto shop. We could really use some advice on how to proceed.
Here are the details:
- It’s a 2021 Tucson with 55,000 miles.
- The estimated repair costs are around $7,500, but it could go up. If costs exceed an additional $4,000, we would have to total it.
- The visible damage is primarily to the left rear quarter panel and bumper, and there may be some alignment issues.
- The car has been valued at about $17,000, and with $7,000 still owed on it, we’d receive nearly $10,000 if we choose to total it.
We’re considering a few key factors in making our decision:
- What will the market look like in 4 to 5 years when we plan to trade it in? We’re worried about the economy, tariffs on foreign cars, and so on.
- How might this repair work impact the car’s future value?
- Is getting $10,000 now a better option than keeping it until the warranty expires, enjoying a few years without payments, and then trading it in later?
Any insights or advice would be greatly appreciated!
Deciding whether to repair your car or total it is definitely a tough choice, but let’s break down the considerations:
Current Value vs. Repair Costs: You mentioned the repair estimate is approximately $7,500. Given the car’s current value is around $17,000, if the total repair costs exceed $11,000 (which is a possibility if more damage is discovered), the insurance company may automatically total it. If you feel the repairs might push towards that higher range, it could be beneficial to consider totaling it now while you have the option.
Future Market Trends: Predicting the car market in 4-5 years can be tricky. If you’re considering economic factors like tariffs on foreign cars, it may influence both the sale and trade-in values of your Tucson. While there’s a chance values might decrease, there may also be a demand for used cars given the current market trends, especially if new car prices continue to rise.
Impact on Value Post-Repair: Typically, cars that have been in an accident and repaired can lose value when it comes time to sell or trade in. This can vary by car brand, type, and how extensive the damage was. A significant repair could potentially make the car less desirable, impacting your trade-in value down the road.
Enjoying No Payments: If you total the car and receive approximately $10,000, that would clear the balance on your loan. This could allow you to start fresh without monthly payments, which can be a considerable financial relief. You could use that money as a down payment on another vehicle, potentially lowering your payments going forward.
Warranty and Longevity: If you decide to keep the Tucson, consider how much longer you anticipate keeping it beyond the warranty period. If you enjoy driving it and believe it will serve you well for a few more years without significant further issues, repairs might be worth it. However, if you’re concerned about potential future expenses from repairs or maintenance, it may sway your decision toward totaling it.
Conclusion:
If you’re leaning towards getting a new vehicle and can net $10k, that might be the safer option. However, if you really like the Tucson and believe it can last you a few more years with minimal issues, weighing the trade-off between current convenience and potential future problems is essential. Engaging with a trusted mechanic about the likely future issues with any repairs may also provide clarity. Ultimately, consider your financial comfort, long-term plans, and how much you appreciate the current vehicle. Good luck with your decision!