Credit Unions To Help In Car Buying

Saturday, December 13, 2008, 6:00 AM | Leave Comment

In a move designed to win new borrowers while aiding Detroit’s beleaguered auto makers, a group of 1,300 credit unions in the nation’s Midwest have pledged to extend $10 billion in auto loans – enough for about 400,000 new cars and trucks.

  • Members of credit unions are located in the states of Michigan, Ohio, Indiana and Illinois.
  • The group made deals with General Motors Corp. (GM) to get “supplier” discounts of roughly 5% plus $250 off the price of vehicle. It was announced Wednesday Dec. 10, 2008.
  • The $10 billion in promised loans would be available for the purchase of any vehicle, including those made by foreign-based auto makers.
  • GM has been hit hard as its auto finance arm, GMAC Financial, clamped down on lending and all but ended the practice of vehicle leasing.

House Representative Don Manzullo, R-Ill., said “Credit unions, local branches of national banks, and community banks are loaded with money, ready, willing and eager to give to people to buy your automobiles.”

Moral of the story

  • The auto industry needs help from every which way possible. Millions of jobs are at stake. Unemployment rate is not just numbers. Real families are hurting.
  • However, there must be an agency from the executive or legislative branch to keep checks and balances with auto industries.
  • We all know what happened in the case of banks and other financial institutions. On October 1, 2008, they received $350 billion from the Treasury to help home owners with their mortgages. They were supposed to help at least 400,000 families. So far, only 100 families have benefited.
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