Need to have a 700+ credit score to get a GM!
10-14-2008, 10:03 AM
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Need to have a 700+ credit score to get a GM!
In a totally absurd move, GMAC the financing arm of General Motors, or Cerberus Capital announced that moving forward applicants will have to have a credit score (FICO) of over 700 to qualify for a loan.
Also, loans will only be extended to 60 months total. No more 72 month, 84 month or 96 month loans will be taken.
GMAC is already expecting to lose 25% of the business of new car loans as a result of this move. Cerberus, which owns 51% of GMAC is most likely applauding this ruling, as it wants to protect it’s future revenues. GM on the otherhand is most likely going into talks with other finance companies to remedy the situation and find proper lending solutions for it’s dealers and end customers.
Another chapter in the automotive world is being written, where the beancounters are winning over common sense. It’s no use building cars if people can’t afford them. Someday even people in Detroit will understand these fundamentals, but until then their stock will be valued accordingly.
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Also, loans will only be extended to 60 months total. No more 72 month, 84 month or 96 month loans will be taken.
GMAC is already expecting to lose 25% of the business of new car loans as a result of this move. Cerberus, which owns 51% of GMAC is most likely applauding this ruling, as it wants to protect it’s future revenues. GM on the otherhand is most likely going into talks with other finance companies to remedy the situation and find proper lending solutions for it’s dealers and end customers.
Another chapter in the automotive world is being written, where the beancounters are winning over common sense. It’s no use building cars if people can’t afford them. Someday even people in Detroit will understand these fundamentals, but until then their stock will be valued accordingly.
More...
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