Sounds like you need a Silverado!

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Quite honestly, you'll probably get a better deal on an '08 F-150 or '08 Ram since both have all-new models out for '09.

Good luck in your search though.

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Now that's a great example of a person who has no clue.

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Bottomless pit? You could buy all the Auto companies in the world for the kind of coin we pumped into Wall St. or squandered on that stupid war in Iraq.

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Perhaps not when it comes to discretionary buying, but for business and personal necessity -- e.g. "I need to replace my current ride" as opposed to "I'd like a new ride" -- this is good news.

And with two buying days before year-end too. If I was a salesman, I'd be qualifying all my fleet/small business accounts for prospects who might take one more shot at 2008.

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this is just the kick they needed. there are many people and businesses who were shut of out buying vehicles due to unreasonable credit restrictions. this will allow many more to buy now.

let's hope the Ford Motor Credit and Chrysler Finaincial follow suit. let's also hope that one of President Obama's first orders of business is to investigate all the banks that received BILLIONS from the government, and still aren't lending a nickel to anyone.

we can never expect any kind of economic recovery without available credit.

AZMike

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People do not need to be getting themselves deeper into debt, they need to hang onto cars they got. What GMAC is about to do is to open up credit to deadbeats, I'm sorry, but if your credit score is under 700 then you shouldn't be able to borrow. Extension of credit is a privilege, not a right.

But anyways, GMAC will take on more toxic debt from deadbeats, of course once they'll default then they'll run to government for more funds and have them take on more of GMAC's crap loans.

This is not a fix by any means, but of course stupid people *ahem* will love it.

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A car loan is not unsecured debt. There is something of value to hold lien against. Also, it doesn't say what kind of credit score this is. Experian scores are not the same as FICO as they index lower. All things considered, it makes more sense to allow lower scoring people to borrow for homes and cars than for unsecured debt as there are ways to recover losses. Credit is necessary for a healthy economy. What we don't need is more of these sub prime mortgages and crap like the Madoff scandal and AIG bailout parties. These are the criminals who created this mess.

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Noidor,

it's good to know that a haughty attitude like yours is still alive in this economic crisis we're in; a "let them eat cake" attitude to be sure!

who are you to determine who needs a car? did it ever occur to you that EVERY day, thousands need a new car?

"deadbeats" are anyone under a 700; OH REALLY?? perhaps you haven't checked your own stellar score lately, have you?

here's a "deadbeat" for you; a good friend that is a General Manager of a dealership. his credit rating is 60/0/0. for those not familiar, this means 60 accounts paid perfectly, with no current lates, and nothing even late in the past seven years. his credit score before was over 750; today, it's 667.

here is what is happening: he has three credit cards, with limits of $15,000-$30,000. he has a balance on each one of less than $2,000. each of the three card companies lowered his limits to his present balances (so he now shows being charged to his limits); his interest rates have gone from 7-9% to 22%. the equity line of credit of $200,000 (with a zero balance) on his home has been completely canceled. of course, every one of these actions is accompanied by a statement on his credit report of "line lowered by subscriber", or "line cancelled by subscriber". to the untrained eye, there looks to be a problem with his creditworthiness. there isn't.

my own score dropped from 667 (the curse of having four open car loans) to 597. again, no changes of any kind; everything shows "paid satis".

you might want to get off of your own high horse; you're probably a "deadbeat", too.

AZMike

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Noidor,

forgot to mention: Toyota Motor Credit (and Lexus), Nissan Motor Acceptance Corp (and Infiniti), and BMW Financial buy paper all the way back to a 600 FICO, and pay a 130% advance to the dealers. the 130% means they will finance 100% of MSRP (plus tax, license, and warranty), plus 30% more to unbury you from your trade-in, all with no money down.

of course, I'm sure from your point of view that this isn't a bad thing for them to do, as these deadbeats (spoken here with teeth firmly closed) "are strictly upper-crust", right?

are these loans "not toxic"?

AZMike

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"here is what is happening: he has three credit cards, with limits of $15,000-$30,000. he has a balance on each one of less than $2,000. each of the three card companies lowered his limits to his present balances (so he now shows being charged to his limits)" - AZMike

Awesome post. I was about to point this out to Noidor to explain why the 700 minimum is bullocks in today's market. The situation you describe with your friend is almost precisely what's happened to me. I had low balances on 3 cards as well (less than $1500 on each) but one bank went out of business and so that account was closed, the other two lowered my limits to just slightly above the balances at the time. So I wound up showing a debt ratio of over 80% and a card closed by subscriber (meaning the bank) on my latest credit report. Hello black eye. My score dropped by 107 points, first time I've been below 700 in years.

These credit reports are written to show that subscribers (ahem.. banks) lowered or closed out credit, but they don't detail *why* -- the reports really make it look like the banks' issues have to do the customer, not with their own financial troubles. The structure of today's credit reports don't function accurately in today's market, which is why it's possible for these reports to send such conflicted messages about someone's credit worthiness. All accounts on my reports are in good standing, and I have only one late payment showing from 6 years ago on a student Visa card. Yet I'm now in the 660 range thanks to a scoring system that's painfully out of date.

Noidor - take the above and ask yourself: How can someone with very strong credit be unworthy of lending just because banks are having trouble? Answer: he's not unworthy, and GMAC among many other lenders know this. GMAC's 621 is not some arbitrary number - it's there as a dividing line because of historical data and statistics generally show that's where the line is between risky and stronger borrowers. When there's money to lend, this is a perfectly acceptable risk for them. But when they don't have cash on hand because they... Oh I dunno.. might just happen to have huge counts of worthless Mortgage Backed Securities in their portfolios, well that could potentially make them want to tighten their standards in order to protect themselves from further loss. They might even decide one way to do this would be to pick a statistically safe FICO score as minimum criteria. Say, around 700 or some other such nonsense.

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If these "secure" assets are so damn good then investors should be lining up to buy them, not the government.

There is a huge oversupply of cars, they are not good being valued right, so with lax lending standards firmly back in the picture, the defaults will continue to mount. So GMAC is back to lending at 100% w/o down payment required, and in case if someone defaults, well hey then there is always the government to run to. That's the system which existed behind Fannie Mae and Freddie Mac and that's precisely what is back now.

I'm sorry, but at a negative savings rate I do not see any reason for extension of easier credit. It's a privilege and not a right as I said above. It's dumb and shortsighted.

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B*tch
B*tch
B*tch....

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Ellis Brooks had been exclusively a Chevrolet dealer until several years ago. they bought Silveira Buick's franchise, and then George Olsen Cadillac's a few years later.

two real issues here:

1) it's incredibly difficult (with fixed costs to match) to operate a dealership in a metropolitan areas like New York (Manhattan) or San Francisco. there is no space to grow. this is one reason that almost every automobile dealership in Manhattan (with the exception of the Potamkin Group), domestic or import, is a "factory" store. as a matter of fact, Cadillac used to be a "factory" store in San Francisco until the early 60's. I remember having the oil changed in my Cadillac deVille at George Olsen back in 2001. the oil change was $85! if I had driven out of the city to a suburban Cadillac dealer, it would have been $30. those fixed costs have to be paid from every transaction, and this makes them extremely uncompetitve with suburban dealers.

2) couple this with the fact of the insane value of San Francisco real estate (especially on Van Ness Anenue), and it just doesn't pay for an automobile dealership to stay a dealership.

it will be interesting to see if Brook's new import store will be in the same location (I doubt it), or in another city in the Bay Area.

I noticed that Silveira didn't get out of the GM car business when they sold out to Brooks; they just got smart and moved to Novato and Healdsburg.

AZMike

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