Marcie Belles's Blog – May 2009 Archive (9)

'Zero Experience'

Check out this article from FOXNews, which questions the auto task force's ability to steer our industry out of its current difficulties.

Here's a snippet:

The combined total of auto industry experience the 24-member task force brings to the bailout negotiations equals zero, and some don't drive at all, note critics.

"Of course we know… Continue

Added by Marcie Belles on May 28, 2009 at 1:30am — 1 Comment

The Money Pit

The fact that General Motors Corp. will almost certainly file for bankruptcy protection in the coming days comes as no surprise. The mammoth automaker is burdened by so many debts that it can’t continue without significant action.

What gets me is the amount of money the U.S. government is willing to throw at the company — another $50 billion. I recognize that there is a lot of industry and a couple hundred-thousand jobs tied to GM, but the company is bound to lay off thousands more… Continue

Added by Marcie Belles on May 27, 2009 at 12:21pm — 1 Comment

Capital Infusion

The government is getting set to inject more than$7 billion into GMAC, turning the company into a quasi-government agency, according to published reports.

The move is part of an effort to improve its lending capability and to bolster GMAC's capital base — after having failed a bank “stress test” earlier this month.

Essentially, this massive capital infusion could upset competition in the industry, particularly for Ford Motor Credit Co., which has avoided tapping government… Continue

Added by Marcie Belles on May 21, 2009 at 8:44am — 1 Comment

More of the Same

GMAC Bank — the troubled mortgage and auto giant that gained bank-holding company status in December — officially reintroduced itself as Ally Bank on Friday.

The rebranding comes after months of research to determine how best to position the bank and to structure its products. For starters, the name is meant to connote trust. Seems like a wise move for a bank that will likely have a $20 billion government tab when all is said and… Continue

Added by Marcie Belles on May 18, 2009 at 12:00pm — 2 Comments

Getting Things Done

Way to go, Tracy.

Tracy, Calif., that is. The Northern California city has decided to take vehicle sales into its own hands, passing a resolution that gives buyers of new cars from dealers in the city a $500 gift card that can be redeemed at local merchants.

Tracy has been hit hard by the drop in vehicle sales, which have declined 50% this year. Normally, about 20% of the city’s revenue is derived from vehicle sales.

So the city council has designated $608,000… Continue

Added by Marcie Belles on May 8, 2009 at 12:00pm — No Comments

Heads or Tails?

A few months back, I blogged about the fact that, increasingly, we’re seeing borrowers whose credit scores are getting hammered because of factors largely outside their control. I proposed that lenders delve deeper into the details of applicants’ credit histories to determine the root of the lower credit scores.

“If not, lenders will pass up some great borrowers who simply hit on hard times,” I wrote at the time. “And borrowers will have to wait longer to secure credit, which will… Continue

Added by Marcie Belles on May 7, 2009 at 11:30am — 2 Comments

GMAC Posts $675 Million Loss for 1Q

On the heels of an announcement last week to finance Chrysler retail and floorplan loans, GMAC Financial Services today reported first quarter financial results. The bottom line: a $675 million loss for the company overall, but a $225 million profit for global auto operations.

Weaker credit performance contributed to the lower auto finance earnings, which had totaled $258 million in the first quarter of 2008.

Here’s a look at some earnings indicators:

*… Continue

Added by Marcie Belles on May 5, 2009 at 11:00am — No Comments

WTG, CPS

With all the hype surrounding the auto manufacturers last week, this news item got short shrift. Nonprime indirect lender Consumer Portfolio Services has launched a pilot program that enables borrowers to make their monthly car payments via cell phone.

The system is straightforward: CPS customers sign up for Western Union’s Bill Alert Text Message Service, then enter their CPS account numbers and payment… Continue

Added by Marcie Belles on May 4, 2009 at 2:00pm — 2 Comments

SBA Expands Dealership Eligibility

The Small Business Administration announced today that it had modified guidelines for qualification to its 7(a) loan program in an effort to improve access to capital for auto and RV dealers, among others.

Under the new guidelines, businesses may qualify for an SBA loan if their net worth falls below $8.5 million and their average net income is less than $3 million. Those metrics usually… Continue

Added by Marcie Belles on May 1, 2009 at 12:30pm — 2 Comments