December 4, 2009
“GMAC SmartLease is taking advantage of innocent people”
Much to my surprise I’ve recently discovered that GMAC SmartLease has changed the way they treat their lease customers. Someone ought to hire a lawyer; this may even qualify for class action status. I can hardly wait to reveal their indiscretions but first let me explain why I feel that I am qualified to discuss this issue.
“Someone ought to hire a lawyer; this may even qualify for Class Action status.”
I have been involved in some capacity in the retail automobile business since 1964. I retired in 2007, so I can safely say that I have 43 years exposure to the car business. I have always been involved in the General Motors business. I have been a Salesperson, a Sales Manager, a Finance Manager, a General Sales Manager, a General Manager, and a Dealer/Owner. I feel that I have some idea of what I am talking about.
Now the Story……………
Since the 70’s I have arranged retail leases using GMAC as the leasing company. I have even leased several for my personal use. In each of my personal leases I have sold or traded my vehicle prior to the end of the lease. It was simple, I would call GMAC SmartLease and they would tell me the payoff. If the vehicle was worth more than I owed, I would sell it to a dealership (often my own) and they would pay me for my equity. Suddenly GMAC SmartLease has changed their program. What has changed is how GMAC SmartLease has decided to interpret the early termination language of their contract.
“If it was worth more than I owed, I would sell it to a dealer and they would pay me for my equity.”
Currently I am leasing a 2007 GMC Acadia. There are only a few payments remaining and the lease will be complete. When I called GMAC SmartLease to inquire as to the payoff, they gave me a figure that appears to be correct. (Residual value plus remaining unpaid payments less unearned interest.) The new change that GMAC SmartLease has incorporated into their business plan is that if anyone other than me were to pay this lease off, GMAC SmartLease wants them to pay approximately $5000.00 more than my payoff. This means that if I were to drive into a GM dealership (or any dealership GM or Non-GM) and work out a new lease or purchase, using my Acadia as a trade in, there would be a $5000 penalty assessed against me for me trading early. I consider myself lucky because I understand that this is really a GRAB on the part of GMAC SmartLease. I am able to protect my self in this situation but I wonder how many unsuspecting people have allowed this sort of thing happen to them. I bet that during the past several months or years there have been hundreds if not thousands of GMAC SmartLease customers who have been taken advantage of. This can not be a good thing.
“There would be a $5000 penalty for trading early”
I wonder if GMAC SmartLease realizes that they are compromising future business. Why would anyone want to ever do business with a company that evokes arbitrary practices designed to take advantage of the public. I like GM vehicles; I did have Cadillac at the top of my list of new cars to consider. However, now I wonder if I can ever force myself to drive a GM vehicle again.
Is this a good long term business practice? Will GM survive with their financial arm attempting to take unfair advantage of customers? A very smart man who coached and trained me in the early years of my career taught me the following:
1) Is it the TRUTH?
2) Is it FAIR to all concerned?
3) Will it build GOODWILL and BETTER FRIENDSHIPS?
4) Will it be BENEFICIAL to all concerned?
I think not.
If you want to know more about this issue feel free to call or e-mail, my contact information is: