It didn't take long for the government bailout of GMAC to filter down to the car lot. General Motors, which has long relied on GMAC to provide...

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It didn’t take long for the government bailout of GMAC to filter down to the car lot.

General Motors, which has long relied on GMAC to provide financing for many of its customers, said Tuesday it would offer zero-percent loans on a handful of vehicles and below-market rates on financing for several other models.

The announcement came the day after the federal government said it would give $5 billion in aid to GMAC, which had virtually ceased making auto loans as a crushing debt load threatened to push it into insolvency.

With the rescue money on the way, GMAC said it would loosen its credit standards so that more borrowers could qualify. Credit scores of above 620 would be accepted, less than then 700 or above that had been required. All of which is welcome news to GM dealers, who are battling the worst sales slump in the U.S. auto market since the early 1980s.

“This is something we’ve been watching and waiting for,” said Mark Parkinson, owner of Tustin Buick Pontiac GMC Hummer in Orange County, Calif.

Normally, 50 to 60 percent of Parkinson’s customers get their loans through GMAC. But during November, almost no sales were financed through the lender.

“After they tightened their credit criteria, no one could qualify,” Parkinson said.

He said sales began to tick up in December after the Bush administration agreed to provide a $17.4 billion bailout for GM and Chrysler. The looser credit standards and GM’s special financing offers should help even more.

“It’s not like a year ago, but it’s the first positive uptick we’ve had in a while,” Parkinson said. “Customers who have been coming in for the last couple of months and just looking are now buying cars. That’s a good sign.”

Whether it lasts is another matter. The Conference Board reported Tuesday that consumer confidence fell to the lowest level since the group began keeping records in 1967.

While not always a direct gauge of consumers’ willingness to spend money, the confidence reading — with the stock market down, housing prices falling and the economy in recession — could bode ill for car dealers, said Greg McBride, senior financial analyst at

Even with a zero-percent loan, a $30,000 car purchased with no money down and paid off over five years results in a hefty $500 monthly payment. If financed at the 7.05 percent current national average rate for auto loans, the payment would be $594 a month, McBride said.

“With the fragile state of consumer confidence and the dim prospects for the job market, a lot of consumers aren’t going to look at it as saving $90 a month in interest,” he said. “They’re looking at it as how confident are they that they can carry an additional $500 a month in debt.”

Many of the juiciest deals are on big SUVs like the Chevy TrailBlazer and GMC Envoy. McBride questioned whether those offers would hold attraction for consumers with fresh memories of paying $4.50 for a gallon of gas.

But with pump prices below $2, shoppers are showing a renewed interest in big pickups and SUVs, Parkinson said.