Press Room

GMAC Survey Finds Consumers Well-Informed About Car Buying Process and Actively Seek Information

Sep 26, 2006

DETROIT - While the majority of consumers are well-informed about the car-buying process, even more could benefit by taking some simple steps--such as understanding their credit scores--before considering financing options, according to a new survey by GMAC Financial Services.

Nearly 70 percent of those surveyed responded that they believed they were well-informed to get the best deal for their money at the time they bought their first car. Sixty-six percent correctly were aware that the best way to lower a monthly payment on car financing is to make a larger down payment, and 83 percent were aware that a monthly car payment should not exceed 20 percent of their take-home pay. Many consumers also are seeking to further educate themselves online, with almost half (49 percent) responding that they conducted online research before buying their most recent car.

However, 72 percent of respondents failed to check their credit report before making their vehicle purchase. Credit scores give consumers an indicator of their relative creditworthiness and help them set expectations for what will be available through the negotiating process.

"Buying a vehicle is a major financial decision, and it is important that consumers fully understand how their credit records factor into their ability to finance a vehicle," said Bill Muir, president, GMAC Financial Services. "This survey highlights the value that companies like GMAC and GM dealers provide as they continue to educate people about the fundamentals of personal finance and give them the knowledge they need to get the vehicle that best fits their budget."

GMAC Financial Services has designed a public education campaign, SmartEdge by GMAC, to help better prepare consumers to set realistic budgets and make smart purchasing decisions. The program, conducted in conjunction with GM dealers and other partners, helps to increase awareness and understanding of automotive financing, unlock the mysteries of personal credit and help consumers decide whether buying or leasing a new vehicle is right for them. In addition to helping consumers understand the factors that affect their credit score, SmartEdge provides information on understanding the choices available and knowing what can be negotiated at the dealership.

"A well-prepared customer is the best customer to have," said John P. Jones, principal owner of Greenfield Pontiac Buick GMC in Milwaukee, Wis. "SmartEdge by GMAC allows dealers like me to help ensure our customers have all the information, tools and resources they need to take control of their finances--before they make a purchase--and help them make vehicle financing decisions that they will be able to sustain over time."

SmartEdge by GMAC offers the following tips for car buyers:




  • Know your credit score. The rate you pay on financing is based in part on your credit rating. As a general rule, the better your credit score, the lower the rate.
  • Establish a good credit history. Pay your bills on time; maintain a small amount of total debt; and minimize the amount of open credit you have available.
  • Determine how much you can afford. Itemize your monthly income and expenses and create a budget to determine how much you can afford to pay on a car purchase or lease. As a general rule, your monthly car payment should not exceed 15-20 percent of your monthly take-home pay.
  • Know what you're talking about. Familiarize yourself with key financial terms. For example, understanding "APR" is important when you finance and "Residual Value" is important to know when you lease.
  • Learn how to make smart choices. Know what is negotiable at the dealership; how finance and lease incentives work; and what optional products you may choose to add to your contract or lease agreement.
  • Understand the differences between buying and leasing. Make sure you have taken your lifestyle into consideration so you can make an accurate comparison between the two.

SmartEdge by GMAC is free to everyone - with absolutely no strings attached - and provides tips for car buyers and useful information such as step-by-step comparisons of the costs of purchasing and leasing.

SmartEdge seminars can be attended locally in communities across the country. Written materials and videos are available online at

About GMAC GMAC is a global, financial services company that operates in 39 countries, in auto finance, residential mortgage, insurance and commercial finance businesses. With more than $300 billion in assets, it generated nearly $2.4 billion in net income in 2005, on net revenues of $19.2 billion. General Motors, which currently owns all of the equity of GMAC, announced earlier this year that it will sell a majority of its interest to a consortium of investors led by Cerberus Capital Management. For more information about GMAC visit


Survey Methodology

These findings are from a survey conducted on the telephone July 13-16, 2006 among a random sample of 1,011 adults. The results have a margin of error of plus or minus three percentage points among the total sample. Many questions are based on a smaller sample of 803 adults who have purchased a car. The margin of error for this smaller sub-sample is plus or minus four percentage points. Opinion Research Corporation of Princeton, NJ, conducted the fieldwork.

Michael Stoller
GMAC Global Communications

print email rss pdf