GMAC Smart Lease

GMAC smart lease programsAustin, are you familiar with the GMAC Smartlease Program? What are you thoughts about it?

Doug H.
Houston, TX

Hi Doug

Let’s first talk about the differences between the GMAC SmartLease and the GMAC SmartBuy Programs. (I do not work for GM nor am I suggesting that one of their new car finance options are right for YOU…I am just giving fact.) Now, GMAC is called Ally Financial.

GMAC SmartLease
You don’t own the vehicle…you are leasing…so you are basically borrowing it.

Upside You drive it for a few years or so then turn it back in to the dealer and get another GM vehicle. I own my own company so I can use my car as a “company vehicle” and take the lease amount as a company expense. So, as a business owner this type of lease works out great. I get a new car every 2-3 years and get to expense it out of my company.


You don’t own the vehicle, and the payments you have made are basically paying interest and not much on the principal on the vehicle. This is where you hear the term “upside down”, the car is worth less than what you still owe…so most people opt to trade the car in at the dealership and get into a new car and a new lease. You are basically “Renting” the vehicle and only paying the accruing interest and finance charges.

Benefits of GMAC Smart Lease

1. Get a new GM vehicle more often than if you purchase it right out, with about the same monthly payment.

2. Low monthly payments

3. No trade in or re-sale issues

4. Can be arranged thru any GM dealership

Benefits of GMAC Smart Buy

1. Get to drive a new GM car more often than if you just bought the car right out

2. Low monthly payments with a final balloon payment due at the end of the contract

I found this video helpful, take time to watch it too.

Some end of year contract options are

1. You can keep possession of the vehicle and make a balloon payment at the end of year to purchase it outright

2. You can decide to sell the vehicle and pay off the balance, thus keeping any profit you might have

3. You can turn in the vehicle and pay a usually very small “vehicle disposal fee” but will also be responsible for excessive mileage, excessive wear and tear or damage charges they might impose.

OK…..let me be totally honest here…..most lease contracts are NOT good deals. Sure they sound great on the TV commercials, with their low monthly payments and low down payments (if any down payment is required) but you better inspect the fine print very close…..there is usually always a “gotcha”.

In my opinion, leasing is great for businesses that can write off the cost as an expense, and they are great for the people with little money to drive a car that they really can’t afford and should NOT think about buying in the first place.

If your goal is to look good driving around town in your new $40,000 BMW that is only costing you $600 a month…..then get the lease. But be aware of what it is going to cost you to get out of the lease once you realize it is not really a good deal for you, and all your friends have caught on to the fact that you are all show.

Please share this with your friends,

Austin C. Davis

Posted in: Auto Loans

7 Comments on "GMAC Smart Lease"

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  1. Otto says:

    GMAC is now Ally Financial that you see on TV commercials….took a HUGE bank bailout thanks to us tax payers. Not for me, nope

    • By Austin Davis says:

      Yes Otto, I think you are correct about the name change, and probably about the bail out money as well. Where was MY bailout money??

  2. Doug says:

    Seems just about all car companies are pushing lease over purchase these days. I can only assume that the best deals are lease deals and the days of actually buying and owning a car are over.

  3. Jason says:

    Things I did not know, thanks

  4. Anonymous says:

    Appreciate your info. I’ve saved your site in my bookmarks to check out tomorrow. Keep up the great work!

  5. Will says:

    Nick, you must be one of those people that Doug is talking about.
    As a car salesman I would never recommend a lease to an individual. I have seen the anger and hurt too many times when someone found out what it would cost to get out of their lease, had to pay a security deposit for a new lease, or found that they
    had nothing to trade in on a new vehicle at the end of their lease period. Leasing is fine for a company or business as during the lease period any expense is a total right-off. What I suggest to a company or business is to lease a new vehicle for a period of time
    and at the end of the lease period purchase the vehicle for the residual amount and take the depreciation off of your taxes for a period of time set by your accountant. Also don’t forget to read the fine print about mileage. This can end up costing quite a large sum if you don’t pre-buy extra mileage. If you purchase at the end of the lease mileage doesn’t matter as the residual would have been set at the time of the lease.

  6. nick from pittsburgh says:

    You obviously know absolutley nothing and are falsely advising people based on your opinions. Leasing is a great way to drive a nice vehicle for cheaper monthly payments and if ur the kind of person who likes a new car every few years it is the only way to not retain negative equity (other than buying vehicles outright which most people dont have the means to do).. Even if you can put a larger down payment on the vehicle to not have the conventional “negative equity” when trading in or selling privately you still took that money out of your pocket so conventionally there is no difference.

    There are reasons why the wealthier people in the world always lease their vehicles. First, because they are financially savvy..How do you think they acquired the wealth. Second, because a vehicle is not a financial investment and should not be treated like one.

    If you like to have a new vehicle every few years and like to have a nice vehicle for a cheaper payment than a lease is right for you. Additionally you never have to worry about maintenance, tires, or repairs because they are all covered for a standard 3 year term.
    Wait until the model year end and monitor the LEASE MONEY FACTORS. Wait for them to be ultra low on the car you want and then lease it.

    If you are the kind of person who can hold onto a car for 10 years and does not care than this guy is right. Purchase the thing. I dislike people who give advice based on their personal feelings and not on the facts. This damn internet seems like its only function is to allow lonely people, who you would never take advice from if you personally met them, a forum to distribute unintelligent, uneducated, opinionated drivel to the world.

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