As said above the best thing is to have it cut out and new piece welded in, otherwise you might repair it and then in 12months it might starting coming through again, so do it once and do it properly. And im talking about both sides.

When i had an escort gti i had both rear arches replaced/painted etc and also a small repair to my front bumper from hitting a bird and all of that cost about £400, so not bad really for the amount of work done