POR-15 is you friend in these situations. Once you cut out the rusted areas as much as you can, you brush POR-15 around the entire area. You can apply it directly over rust too. It's an awesome product for this kind of thing. Covers rust and prevents it from happening again wherever POR-15 is covering metal. Expensive, but worth it. I bought a 4 oz. can and it was like $11 I think.

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