Ally’s new loan has a special option

Ally’s new loan has a special option
Jim Henry
Automotive News | October 31, 2011 – 12:01 am EST

Ally Financial is launching a new kind of loan that’s like an ordinary auto loan in every respect except that it comes with an option whereby the customer can choose to sell the vehicle to Ally at a guaranteed price 48 months into the loan.

“What’s new is the certainty of the value of the vehicle,” said Tim Russi, executive vice president of North American Operations for Ally. He said the preset price mimics the residual value on a 48-month lease.

Ally calls the program Ally Buyer’s Choice. It’s already in the pilot phase with a few big General Motors and Chrysler Group dealerships in California, Florida, Illinois, New York and Texas, Russi said. The pilot is scheduled to start rolling out to all dealerships in those states, starting Nov. 1. The company plans to roll it out nationwide eventually.

Russi said that as with any other loan the customer could sell or trade in the vehicle at any point. But the preset price applies only in the 48th month of the loan. “For the dealer, the OEM and the consumer, that 48-month point is critical. That’s the time consumers start to look at ‘How long do I want to keep my vehicle?”’ he said.

Eventually, Ally may vary the program to offer different intervals for the option-to-sell clause, Russi said. “We’ll see where it goes,” he said.

PRESS RELEASE: Ally Financial Launches Innovative Vehicle Financing Product

Ally Buyer’s Choice product to debut initially in five U.S. markets

DETROIT, Oct. 31, 2011 /PRNewswire/ — Ally Financial Inc. launches Ally Buyer’s Choice, an industry-first product offering for U.S. dealers and customers on new 2011 and 2012 General Motors and Chrysler vehicles.

Ally Buyer’s Choice is an innovative financing product that delivers the best of both worlds for customers who want the advantages of both buying and leasing.

Ally Buyer’s Choice allows customers to own their vehicle with a fixed rate and payment with the option to sell it to Ally at the 48th month of their contract, at a pre-determined price. The product is ideal for customers interested in purchasing a vehicle, rather than leasing, but provides the flexibility during the ownership experience to sell the vehicle to Ally, should their needs or preferences change.

“Ally Buyer’s Choice is a true differentiator in the market and provides great flexibility and choice for consumers,” said Tim Russi, executive vice president, North American Operations for Ally Financial. “Ally is committed to bringing industry-first products to market that offer consumers more choices and help dealers sell and service more vehicles.”

Vehicle financing terms through Ally can range from 60 months and 84 months. Customers can elect to sell their vehicle to Ally or continue making monthly payments for the duration of the finance contract, if they wish to keep their vehicle.

Ally Buyer’s Choice also provides another flexible financing option for dealers to offer customers, allowing them to meet a variety of customer needs. The product can reduce the customer’s buying cycle time, increasing showroom traffic and vehicle service opportunities.

Ally Buyer’s Choice will debut in California, Florida, Illinois, New York and Texas. Additional markets will be added over the coming months.

Customers in the initial markets who are interested in finding out if Ally Buyer’s Choice is right for them can visit any GM- or Chrysler-affiliated dealers.

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