Ally Financial is unveiling a new kind of loan -- an auto loan that comes with an option for the client to sell the vehicle, 48 months into the loan, to the company at a guaranteed price. Tim Russi, executive vice president of North American Operations for Ally, disclosed that what is new with the auto loan is the certainty of the vehicle's value. He further stated that the preset price mimics the residual value on a 48-month lease.
This loan program is dubbed as the Ally Buyer's Choice, and is already in the pilot phase with a few prominent Chrysler Group and General Motors dealerships in Florida, California, New York, Texas and Illinois, Russi disclosed.
The pilot is set to begin rolling out to all dealerships in those states on November 1. The company intends to roll it out across the United States eventually. Russi stated that as with any other loan, the client can sell or trade in the vehicle at any point.
However, the preset price applies only in the 48th month of the loan. Russi explained that the 48-month point is critical for the OEM, the consumer and the dealer, as it is the time when clients begin to consider how long they will want to keep their vehicle. Ally may eventually vary the program to provide different intervals for the option-to-sell clause, Russi stated further.