Auto financing should be easier with GMAC’s loan from the government
December 30, 2008 by admin
Consumers may be able to start purchasing cars in the near future through General Motors as the companies finance arm received a much needed boost from the governmenet this week as a six billion dollar loan to the company has been approved through it’s recent application to become a bank holding company using funds for the tarp program. The finance company has struggled to make loans available for consumers who are looking for cars as the credit markets have deteriorated and there has been no secondary marketplace to securatize loans.
General Motors received a much need bridge loan a few weeks ago that is desinged to help the company make it through the first quarter of 2009 while it works on a restructuring program. The ability to finance and sell cars will certainly assist the company with it’s plan to move towards profitability. Consumers are going to benefit from the latest move by the governement as car financing for both new and used cars has become extremely challenging despite a move earlier this year by the government to provide over $350 Billion to banks to help them increase their lending and boost the economy. It is expected that both Ford Motor company and Chrysler Financial will receive similar assistance to their finance arms in the near future to further boost these companies ability to sell and finance their cars and inventory.