Municipal Lease-Purchase Plan
GMAC specifically designed our Municipal Lease Program for municipalities that intend to own their vehicles. It is a retail financing program for eligible municipalities or political subdivisions interested in financing their essential-use vehicles at favorable tax-exempt interest rates.
Contact a dealer for more information about the GMAC Municipal Lease-Purchase program.
Benefits
The Municipal Lease-Purchase Plan offers customers the following benefits:
- Ability to stretch municipality dollars by maximizing limited budgets
- Flexibility of obtaining vehicles when they're needed, not just at certain times of the fiscal year
- Documentation designed with municipalities' needs in mind
- Flexible payment schedules
- No mileage restrictions
- Optional extended service agreement
- Optional maintenance packages
Municipalities may choose from the following payment plans subject to GMAC's approval:
| - Monthly | - Semi-Annual |
|---|---|
| - Quarterly | - Annual |
For quarterly, semi-annual, and annual payment transactions, the first payment will be due upon delivery.
For monthly transactions, the municipality may choose to make the first payment upon delivery, or within 30 days thereafter.
Other Features
- Advance: Up to 100% financing of vehicles. Includes certain upfit packages
- Maximum Terms:
New Vehicles:
Type
Maximum Terms
Medium-duty trucks Five years Passenger cars Four years Light-duty trucks Four years Police and public safety vehicles Three years, or four annual payments
Used Vehicles:
Age of Used Vehicle
Maximum Terms
Current Series Used Through 1 year old Three years
- Rates: Favorable tax-exempt interest rates.
- Residual: $1.
- Security Deposit: None.
- Taxes: Municipality pays all applicable sales and property taxes.
- Documentation: Because GMAC specifically created this plan for municipalities, documentation already includes certain clauses that municipalities often require to enter this type of transaction.
- Titling: Vehicles are titled in the municipality's name, with GMAC as lienholder.
- Maintenance: Municipality maintains the vehicles at its own cost.
- Mileage Limitations: Since the municipality will own the vehicle at maturity, there are no mileage limitations. Because of the "non-appropriation" risk, GMAC limits term to coincide with anticipated mileage.
- Insurance: Municipality maintains vehicle's insurance, in accordance with insurance requirements for retail financing transactions, at its own cost. Because many municipalities are self-insured, GMAC may consider a waiver of the physical damage and liability insurance requirements, but only if and to the extent permitted by law.
- Additional Deliveries: Municipalities may easily add units to an existing Municipal Lease-Purchase Agreement subject to GMAC's approval.
- Bid Assistance/ Competitive Equalization: Dealers may use bid assistance where available.
Which customers are eligible?
Qualified, tax-exempt municipalities for federal tax purposes, including states or political subdivisions of state governments, such as:
- Cities
- Police departments
- Fire departments
- Sheriff departments
- Counties
- Villages
- State universities
- School districts
IMPORTANT: These entities must qualify under Section 103 of the IRS code. Tax-exempt status alone does not automatically qualify an entity as eligible. Examples of tax-exempt, non-municipal entities which do not qualify are churches, charities, and private hospitals. Federal government agencies also do not qualify.
Municipalities should consult with their legal departments regarding tax-exempt status.
Which vehicles are eligible?
Vehicles of the following types, up to one year old:
- New or used passenger cars of any make or model
- Light or medium-duty trucks
- Certain upfitted vehicles
- Police and fire department activities
- School bus service
- State university travel
- General service
- Ambulance service
- Snow removal work
- Department of Transportation travel
- Department of Public Work activities
Please click here for the Municipal Lease-Purchase Plan FAQs
