GMAC gets $5B bailout

[moneysense]

The treasury department will provide $5B to GMAC Financial Services. This is the part of GMAC that is in financial trouble.

In return for the $5B given to GMAC, the government will get preferred shares that pay an eight percent dividend, plus warrants to purchase more shares in return for the money given.

This loan is on top of the $17.4B that was promised to the industry by Bush.

GMAC will act quickly to resume automotive loans to a much broader spectrum of customers.

Though the $5B investment was settled on on Monday, the $1B loan is still in progress.