Ally Bank – which I’d much rather have seen incorporated with a cryptic symbol or something, so that I could refer to it just as “The Bank Formerly Known As GMAC”, because that’s what it is – still has a loose affiliation with GM, cutting car loans for the automaker and, shockingly enough, apparently exacting standards, with an iron fist, as to who gets a loan and who doesn’t. It’s almost like someone at Ally actually learned something from the hot mess they had to be bailed out of when they got into subprime mortgage lending, and doesn’t want any more risky lending on their books.
GM hates this, natch:
If your credit isn’t good, General Motors Co. still wants to sell you a car.
The problem is, it can’t. At least not in big numbers. That’s why the automaker wants more control over its lending again.
GM’s top North American executive Mark Reuss, under pressure to quickly sell more cars and boost GM’s value as it gets ready to sell stock to the public, said a shortage of subprime lending is holding back sales in the U.S.
Makes sense. GM wants to move cars, and Ally is like, “screw you guys, if your credit store is below 620 why don’t you go get a used minivan from Family Auto Mart?” Ally’s actually made their auto lending arm super duper lucrative with this new Era of Standards, so really, if it ain’t broke, they are probably thinking, why fix it. Yes, it helps that the government designated them the preferred lender for both GM and Chrysler, seeing as it owns heaping helpings of all three entities, but a decline in defaults always helps with keeping you in the black.
I suppose the government will mediate this debate, as doting parents tend to do. And now, for those lucky enough to not be versed in this particular piece of infomercial glory, here’s a snippet of Family Auto Mart: