automotive

GMAC Limits Credit; Toyota Bows Visa Rewards

Toyota Visa cardFormer GM financial services arm GMAC Financial Services is tightening loans to car buyers. The firm put out a release Tuesday stating that because of the lack of stability in the global capital and credit markets, it is limiting purchases to contracts with a credit score of 700 or above. The group is also boosting the amount of money it charges dealers for providing non-incentivized consumer auto financing.

 

"These changes in pricing and underwriting are related to the current market environment, which has reduced access to funds and increased the cost of funds. The company currently expects these actions to remain in place until the credit markets stabilize and accessibility improves," said the firm in a release.

Toyota Financial Services, meanwhile, is launching Toyota Rewards Visa. Cardmembers earn Toyota Rewards Points from purchases that can be redeemed toward parts and accessories, an eligible vehicle lease or purchase, or service from participating Toyota dealerships.

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The card proffers five "Toyota Rewards Points" for every $1 spent at participating Toyota dealerships, and one point for every $1 spent everywhere else that Visa is accepted. It also offers 2,500 bonus Toyota Rewards Points upon first purchase redeemable toward next eligible dealership purchase.

A spokesperson said the effort follows a similar program under Lexus Financial Services launched in 2005. She says the company will promote the program via a Web site--Experience.ToyotaRewardsVisa.com--direct mail, banner ads, and a full-page ad in USA Today this Friday.

"But it will be promoted predominantly through dealerships," she says, adding that the program has been in the works for over a year, "long before the current credit crisis."

"We saw a lot of success with the Lexus card; dealers see its value, since it builds loyalty both for the brand and for dealer service since they earn points whenever they return."

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