• GMAC Loans and SmartLease: A Definition

    GMAC loans and SmartLease programs provide options for borrowers who are interested in owning or leasing a new General Motors vehicle. While a GMAC loan is a traditional installment finance contract, a SmartLease has terminology all its own that can help you get a more affordable monthly payment on the vehicle you want.

    In a lease, there are three figures that will have a significant impact on your monthly payment. First is the selling price of your new vehicle. Even though you are leasing, you can still negotiate a good selling price for your new vehicle. Try to get as close to the supplier price or invoice price as possible. Second is the money factor, or the APR at which the credit will be extended to you. Third is the residual value of the vehicle, the amount that the vehicle is projected to be worth at the end of the term. The residual value will vary based on how many miles you purchase for your lease. All of these numbers are pre-set at the beginning of the lease.

    Your monthly payment will be comprised of two figures. First is the depreciation. Depreciation is equal to selling price minus residual value, divided by the length of your lease. Second is your rent/lease charge, which is equivalent to interest. Interest is charged at the same rate each month for the term of the lease. In some states you must pre-pay taxes on your SmartLease, while in others your base payment (depreciation plus rent/lease charge) is used to calculate a monthly sales tax charge.

    You will also be charged an acquisition fee at the start of the lease, and remember that you are responsible for a $595 disposition fee at the end of the lease, should you not lease or purchase another GM vehicle. You will also have the opportunity to purchase the vehicle at the end of the term for the residual value, plus any unpaid taxes on the balance. The residual value is stated in your contract and is not normally negotiable.