GMAC end auto loans in 7 countries

GMAC LLC, the money losing home-loan and auto finance lender, will halt new vehicle loans through its financial services unit in seven European countries as global credit markets deteriorate. The company will stop originating loans in the Czech Republic, Finland, Greece, Norway, Portugal, Slovak Republic and Spain, Detroit-based GMAC said today in statement.

In those countries and in Hungary and Denmark, GMAC will “assess the implications of this challenging environment with the aim of diversifying funding sources for dealers over time,'' the company said.

Plagued by tumbling auto sales, ratings cuts and tightening credit markets, GMAC is scaling back lending in Europe following reductions in the U.S. and Canada. GMAC's part owner, General Motors Corp., had its debt downgraded by Moody's Investors Service yesterday and AmeriCredit Corp., the lender to car buyers with blemished credit record, said uncollectible debt jumped in the quarter ended September.

Chief Executive Officer Al de Molina said in an e-mail to employees this month that the company has “limited if any access to funding'' for its mortgage and auto-lending units and may trim lending in some international markets. The company also said this month it will limit auto loans in the U.S. to borrowers with credit scores of at least 700, making it harder for some customers to buy a car or truck. Bloomberg