Over the years General Motors dealers have been able to count on GMAC, the lending company owned in part by GM, to provide loans to car buyers at their dealerships.
Before the economy started its nosedive, GMAC-originated loans provided financing for almost half of GM car buyers. But now that the company is concerned about stability, GMAC is cutting back on who it will give loans to. In a letter dated Oct. 13, it announced to all GM dealers that it would no longer make vehicle loans for anyone with a credit score below 700, this coming on the heels of previous cuts which have already cost GM 10,000 buyers a month.
Any move to tighten up credit restrictions by a major corporation will affect parties in different ways; we are going to look at how it will affect the major players below.
Banks and Credit Unions