GMAC

Auto
4:55 pm
Thu November 22, 2012

GM rebuilds its finance arm with Ally purchase

General Motors was a deeply troubled company in 2008.

Eh.  Make that deeply, deeply, deeply troubled.

So was its finance arm, GMAC, which had plunged head-first into subprime mortgage lending, in addition to automotive lending.  That left the company awash in billions of dollars worth of bad mortgages.

The federal government had to figure out a way to bail out both companies - because GM wouldn't survive if it didn't have a place to send customers for car loans, and if its dealers didn't have a place to get financing to buy the inventory.

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Business
5:46 pm
Mon May 14, 2012

Ally Bank to sell some assets, place another in bankruptcy, to pay off taxpayers

Detroit's Ally Bank, formerly known as GMAC, says it will sell off foreign subsidiaries and put its mortgage division into bankruptcy, in an attempt to pay back its government bailout.

The U.S. Treasury gave more than $17 billion to GMAC when it bailed out GM.

The money was meant to prevent the collapse of loan availability for GM vehicles and GM dealers.

So far, GMAC, now Ally Bank, has paid back $ 5.5 billion.   

But it was unclear how the company would pay back the rest. Its mortgage arm loses money every quarter on subprime mortgage loans made before the bank crisis of 2008.

Now Ally says it will put its mortgage division into bankruptcy, and sell off foreign subsidiaries.   The company says that will allow it to repay a total of 2/3 of what it owes the Treasury before the end of the year, leaving a balance of about $6 billion. 

Ally officials say they will provide bankruptcy financing for the mortgage arm, known as Res Cap, and strike a financial deal with the company's creditors, so that Ally can come out of the mortgage division's bankruptcy with no additional liabilities.

Economy
12:03 pm
Wed January 26, 2011

Bridgewater Place in Grand Rapids sold at foreclosure auction

Bridgewater Place pictured at the far left.
John Eisenschenk creative commons

One of the biggest office buildings in Grand Rapids sold for $34 million at a public foreclosure auction today. The 17-story blue-glass Bridgewater Place building dramatically changed the city’s skyline when it was built in the early 1990s.

Many people refer to the building as the Varnum building, because of the law firms’ prominent logo near the top floor.

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