GMAC LLC, the auto and mortgage financing division of General Motors, has reacted positively to the investment given to it by the US Treasury. The funds granted amount to $6 billion, $5 billion of which bought equity in GMAC and the rest was loaned to GM itself to buy stock in the financing house. GM's reaction to the windfall has been to relax certain credit restrictions to consumers in order to enlarge the pool of potential customers and immediately boost sales. GM sales are down about 22 percent overall.
These incentives for example, include offering interest rates as low as 0% for up to 60 months on cars and trucks. Models that should benefit include GMC Envoys, Saab 9-5s and Chevrolet Blazers. GMAC had, only two months ago, increased the credit score required to qualify for auto lending to 700 "due to the credit crisis". This time the company lowered the score to 621, which should now include the 40% of people that were previously excluded by the steeper score of 700.
"The actions of the federal government to support GMAC are having an immediate and meaningful effect on our ability to provide credit to automotive customers," GMAC President Bill Muir said in a statement. "We will continue to employ responsible credit standards, but will be able to relax the constraints we put in place a few months ago due to the credit crisis. We will immediately put our renewed access to capital to use to facilitate the purchase of cars and trucks in the US."
Many of the vehicles with incentives have stackable bonus cash and/or dealer cash ranging from $500 to $4,250.
See press release below for specific incentives.
GM Announces Significant New Loan Financing As Low As 0% APR for Up To 60 Months
DETROIT - GM today announced new reduced rate financing as low as 0% APR for up to 60 months on select new cars and trucks. The reduced rate financing is available to qualified buyers today through January 5, 2009 on many 2008 and select 2009MY vehicles (see list below). Of note, many of the vehicles listed below have stackable bonus cash and/or dealer cash ranging from $500 to $4,250.
"We're very excited to offer this reduced rate financing through GMAC to encourage our customers to get back into the game," said Mark LaNeve, vice president, GM North America Vehicle Sales, Service and Marketing. "This enables even more qualified customers to finance through GMAC at their local GM dealership, and provides additional financing capacity with conventional and reduced rate APRs for our dealers to make sales. With GM's Financing That Fits, and the Red Tag Sale now underway that offers supplier pricing, customers have an opportunity to get a variety of extremely attractive offers through the end of the year."
2008MY vehicles and offers for qualified buyers:
- 0% APR for up to 60 months on '08 Chevrolet TrailBlazer; GMC Envoy; and Saab 9-3, 9-5, 9-7X
- 0.9% APR for up to 60 months on '08 Buick Lucerne
- 1.9% APR for up to 60 months on '08 GMC Yukon and Yukon XL; Chevrolet Tahoe, Suburban and Avalanche; Cadillac CTS, SRX, Escalade, DTS, STS and XLR
- 2.9% APR for up to 60 months on '08 Buick Lacrosse; HUMMER H2 and H3
- 3.9% APR for up to 60 months on '08 Chevrolet Equinox, Colorado Ext and Crew cab and Light Duty Silverado; Pontiac Torrent; GMC Canyon Ext and Crew cab, and Light Duty Sierra
- 4.9% APR for up to 60 months on '08 Saturn Astra and Sky; Pontiac Solstice; Chevrolet Corvette and Heavy Duty Silverado; and Heavy Duty GMC Sierra
2009MY vehicles and offers for qualified buyers:
- 3.9% APR for up to 60 months on '09 Chevrolet Cobalt; Pontiac G5; and Cadillac CTS
- 4.9% APR for up to 60 months on '09 Pontiac G6; Chevrolet Malibu, Light Duty Silverado and HHR; Saturn Aura; and Light Duty GMC Sierra
- 5.9% APR for up to 60 months on '09 Chevrolet Avalanche and Heavy Duty Silverado; and Heavy Duty GMC Sierra
