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You may want to consider cutting out that area and replacing it with a section from a donor car. I had put full quarters on my 74 and the one was a tad too long and I made marks where I wanted to cut it at and then slowly trimmed down the metal on the car and the part that I had cut off until everything lined up properly. I then beveled the edges on both sides and then tack welded it together and then slowly started stiching it all the way together with weld. When I got done grinding down the welds it took very little filler and by placing the cuts where I did I was able to detail out the backside of the panel also even though on my hatchback it's covered with an interior plastic panel.
I have seen guys shrink metal but if it's stretched too far then it might be more work than just replacing it with a patch.

As far as the rust holes in the rear lips it's probably just the beginning of what will appear later as that area normally rusts from the inside out. With the lip having holes you also need to check the lip of the outer wheelhousing. If it is gone then a new outside lip has nothing to attach to so then that has to be repaired before the lip is.

I would really look and see if maybe a half quarter would be better to install as this would take care of the damage on the wheel lips and back by the trunk opening. There's nothing worse than doing all kinds of rust work only to have another spot pop out later after it's all painted. If it was me I would be checking the area's that normally rust and also start poking around with a sharp awl to find any thin spots.

The only way to get to the next level of bodywork tasks is to either try it alone or get guidance from someone that is at that level. Reading and writing about things does not always work as you need to actually do it so you can learn. I learn stuff everyday and hopefully forget less.

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