Total high-interest loans 2005-2007:
At least $17.2 billion ***
Federal bailout money received:
GMAC received $5 billion from the government’s Troubled Asset Relief Program.
Company overview
- Status: ACTIVE
- History: GMAC was created to fund the purchase of General Motors vehicles and later expanded into mortgage lending. GMAC Mortgage was created in 1985, and five years later GMAC purchased Residential Funding Corporation, which became GMAC-RFC. GMAC also formed Homecomings Financial in 1995 from the purchased assets of another company. In 2005, ownership of GMAC Mortgage, GMAC-RFC, and Homecomings was transferred to a newly formed holding company, the Residential Capital Corp. (ResCap). In April 2006, GMAC announced it was selling a 51 percent stake to a capital investment group led by Cerberus Capital Management. Other investors included Citigroup Inc. GMAC, stung by the collapse of the real estate market and slow auto sales, turned to the government for help in late 2008. The Federal Reserve approved GMAC’s application to become a bank holding company, thus allowing it to receive a $5 billion investment from the Treasury Department.
- Parent/subsidiary companies: GMAC is 51 percent owned by an investor group led by Cerberus Capital Management, with the rest held by General Motors. GMAC has several lending subsidiaries including GMAC-RFC Holding Co. LLC, Residential Funding Co. LLC, and Homecomings Financial LLC.
- CEO: CEO (GMAC Financial): Alvaro G. de Molina (still in that position as of May 2009)
- Most recent salary: Not available
- Location: Minneapolis
- Year founded: 1982 (GMAC established in 1919)
- Backers: GMAC’s Residential Funding Co. was one of the industry’s top 10 issuers of subprime mortgage-backed securities in 2006 and 2007, packaging its own loans and partnering with investment banks to underwrite or sell certificates to the public.
Lobbying overview
- Lobbying: 2007-2008: GMAC reported $6,080,000 in lobbying expenditures. **
- Total Contributions: At least $5,893,576 *
- Top Recipients:
1. Republican National Committee $445,730
2. Representative John Dingell, D-Michigan $223,850
3. Democratic Congressional Campaign Committee $185,704
4. National Republican Congressional Committee $183,356
5. National Republican Senatorial Committee $153,435
Investigations
- Settlements:
• In 2004, GMAC-Residential Funding Corp., along with several other institutions, agreed to a $41 million settlement of a class-action lawsuit filed in federal court in Pittsburgh over predatory lending claims.
• In 2005, Homecomings Financial Network Inc. (a GMAC subsidiary) and Fairbanks Capital agreed to forgive $11 million in debt and give a total of $773,000 in restitution, account credits, and refunds to West Virginia homeowners.
** Lobbying totals calculated by the Center for Public Integrity using data from the Senate Office of Public Records.
* Contribution grand total includes employee and soft money contributions from the lender and its subsidiaries. Top recipient totals include employee and political action committee contributions. Data provided by CQ Money Line, analysis by the Center for Public Integrity.