GMAC Expands Lending
On December 30th, 2008 GM took the Federal Government up on their commitment to loan them $6 billion dollars in aid. This included $5 billion dollars under the troubled asset program which is a $700 billion dollar fund originally designed to help the banks. The Treasury also offered a new $1 billion dollar loan to GM, so that they can participate in a rights offering at GMAC.
GM has taken advantage of that move. They have a new promotion offering zero-percent or low-interest financing on some slower-selling 2008 and 2009 models over the next week. The company is hopeful that this promotion will help to jump-start sales as GMAC announced plans to expand lending to retail customers.
GMAC said it would begin making loans immediately to borrowers with credit scores of 621 or higher. In November, after GMAC raised credit standards for borrowers, the company financed just 1 percent of GM’s sales, compared with as much as 45 percent in a normal month.
This is good news to dealerships who have been farming out the loans to local credit unions and banks. With GMAC back in the game and these new promotions available, it has dealers hopeful that cash-strapped consumers will return to their showrooms.
At this point and time is GMAC the only lender following the guidelines set by the government? I haven’t found or heard of any, have you?
GM has taken advantage of that move. They have a new promotion offering zero-percent or low-interest financing on some slower-selling 2008 and 2009 models over the next week. The company is hopeful that this promotion will help to jump-start sales as GMAC announced plans to expand lending to retail customers.
GMAC said it would begin making loans immediately to borrowers with credit scores of 621 or higher. In November, after GMAC raised credit standards for borrowers, the company financed just 1 percent of GM’s sales, compared with as much as 45 percent in a normal month.
This is good news to dealerships who have been farming out the loans to local credit unions and banks. With GMAC back in the game and these new promotions available, it has dealers hopeful that cash-strapped consumers will return to their showrooms.
At this point and time is GMAC the only lender following the guidelines set by the government? I haven’t found or heard of any, have you?
posted by Kathy at
2:15 PM
1 Comments:
Maybe, instead of continuing to pump money into Wall Street and demonizing the auto companies, Congress, the President and the Secretary of the Treasury should look at the actions of GMAC and see how to get the other lenders that have accepted money to follow their lead!
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