Was “tapped” by a car, impacted the rear wheel area and now I have this gap difference. Any recommendations? Some details in comments

I’m able to ride the bike just fine with the rear brake disconnected. If I hook up the brake, one pad is pushed against the rim and the other pad has almost too big of a gap to contact the rim at all. If I spin the wheel the gap doesn’t change, indicating the wheel isn’t bent (correct me if I’m wrong).

I’m new to mountain bikes and threw this old Specialized together before coming to college, and I’d really like to keep it alive if possible. The driver that hit me is willing to help pay for repair.

The wheel may have just moved in the dropout. Check that first