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GMAC Financial Services expects $5-billion loss

The auto lender, which has received $16.3 billion in federal aid, says most of the fourth-quarter red ink will stem from a $3.8-billion charge.

January 06, 2010|By Ken Thomas

Washington — Auto lender GMAC Financial Services said Tuesday that it expected to announce a combined fourth-quarter net loss of about $5 billion, hurt by its struggling mortgage division.

Detroit-based GMAC said that a previously disclosed $3.8-billion pretax charge was the main driver of the anticipated loss and that it had taken steps to sell some of its mortgage assets after a third installment of federal aid.

GMAC received $3.8 billion in taxpayer money last week and has received $16.3 billion in total. The move boosted the government's ownership to 56% from 35%.

The Obama administration has tried to keep GMAC alive as part of its rescue of automakers General Motors Co. and Chrysler Group. GMAC provides wholesale financing to thousands of GM and Chrysler dealers.

Thomas writes for the Associated Press.

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