GMAC sponsored the Hendricks Motorsports Chevrolet, driven by Brian Vickers, in 2006. Photo from www.hendrickmotorsports.com

General Motors was the first car company to establish loans for autos. GM founded General Motors Acceptance Corporation (GMAC) in 1919 as a provider of financing to automotive customers. GMAC extended credit to buyers and created monthly payments for consumers – which made it substantially easier for the public to buy a new car. Once GM had created the car payment system, new markets were opened up with great success. Other car companies quickly followed by creating their own payment systems.

Their chief rival, Ford Motor Company, refused to follow GM’s lead in establishing financial services. Henry Ford was obsessed with giving simple people the simple machines that kept a rural lifestyle alive. These outmoded ideas debilitated Ford’s company and they eventually relented.

An early GMAC advertisement. Photo from www.autonews.com

Edsel Ford, who was President of the Ford Motor Company in name only, gave way to Henry Ford’s direction. The elder Ford, founder of Ford Motor Company, believed these loans to be potentially damaging to the economy and the car buyers. They refused to follow GM’s system of extending credit for as long as they could. GMAC originally opened branches in Detroit, New York, Chicago, San Francisco, and Toronto.

Over the following years the business has expanded to include insurance, online banking, mortgage operations, and commercial finance.

In 1985, GMAC formed GMAC Mortgage after it acquired the mortgage loan operations of the Colonial Mortgage Service companies. GMAC was given conditional approval to form GMAC Bank in 2000.