How this calculator works
Both choices are costed over the number of years the repair is expected to buy, and the totals are divided by those years. Keeping the car costs its current as-is value (the price it could be sold for instead), the repair, further repairs and any difference in insurance and maintenance each year, less what it will be worth at the end. Its end value is the after-repair value reduced by the yearly percentage entered.
Replacing costs the price, plus the loan interest paid over those years, less the replacement’s value at the end; the old car’s as-is value is applied as the down payment. The breakeven repair quote is the quote at which the two yearly costs are equal. The repair’s share of the car’s value is shown for comparison with the common rule of thumb, not as the answer.
Worked example
With the defaults, keeping costs the $6,000 the car could be sold for, the $2,800 repair and $900 a year of further repairs, less $400 a year saved on insurance and maintenance, minus a value of $3,992 after three years at 15% a year: $6,308, or $2,102.73 a year.
Replacing costs $22,000 plus $2,057 of interest on a $16,000 loan at 6.5% over the first three years, less a value of $13,640 at the end: $10,417, or $3,472.25 a year. Repairing is cheaper by $1,369.52 a year, about $114 a month, and stays cheaper for any quote up to $6,909, even though $2,800 is already 46.7% of the car’s value.
How to read the result
A positive difference means the repair costs less per year than replacing; the breakeven quote says how much the repair could cost before that flips. The result leans heavily on the further-repair estimate and on how many years the repair really buys, which are the two inputs hardest to know, so the table shows the comparison for one to five years.
Replacement depreciation usually dominates: a new car’s value falls fastest in its first years, and that is spread over few years here. With a $6,000 repair and $1,800 a year of further repairs, replacing becomes cheaper by about $597 a year. Paying cash for the replacement removes $2,057 of interest and lowers the breakeven quote to $4,852.
Assumptions and sources
- Federal Trade Commission, Financing or leasing a car — how APR, loan length and the amount borrowed set the cost of financing a replacement
- Consumer Financial Protection Bureau, What is included in the monthly auto loan payment? — principal and interest in an auto loan payment
Checked October 2026. Car values, repair estimates, the yearly loss of value and the replacement’s resale share are inputs, not market data; a repair estimate and a written trade-in quote are the most useful replacements for the defaults.
Common mistakes
- Comparing the repair bill with a monthly payment. A $2,800 repair against a $380 payment looks expensive, but the payment continues for years while the replacement also loses value.
- Ignoring what the car is worth unrepaired. Keeping the car means not selling it now; that value is part of the cost of keeping it.
- Assuming the repaired car needs nothing else. Older cars keep needing work; the further-repairs estimate carries as much weight as the quote.
- Forgetting the replacement depreciates. The new car’s value falls fastest in its first years, which is usually its largest cost over a short period.
- Using the 50% rule as the answer. At the defaults the repair is 46.7% of the car’s value, yet repairing stays cheaper up to a $6,909 quote; with high further repairs it can lose at a lower share.
Frequently Asked Questions
Is it worth repairing a car worth less than the repair?
Sometimes. The comparison is not the repair against the car’s value but the yearly cost of keeping it against the yearly cost of a replacement, which includes the new car’s depreciation and interest. A costly repair that buys several more years can still be the cheaper choice.
Does the 50% rule hold up?
It is a rough screen, not a calculation. It ignores how many years the repair buys, the further repairs expected, and what the replacement will cost to own; the breakeven quote on this page can sit well above or below 50% of the car’s value.
How can future repair costs be estimated?
From the car’s recent repair history and the maintenance schedule for its age and mileage, and from a mechanic’s view of what is likely to fail next. The table shows how the answer changes with the number of years kept.