Update: HUMMER has for now done away with their Smart Buy program, citing market shifts and banking industry woes — we’ll keep the information here in case the program makes a return.
We get a lot of questions about Hummer Smart Buys (primarily found in Texas) — I hope the following information from GMAC can help dispel some of the confusion surrounding them:
GMAC’s Hummer SmartBuy
GMAC SmartBuy puts the GM vehicle you want within reach. SmartBuy is like a lease because monthly payments can be lower than with traditional financing, however, with SmartBuy you own the vehicle. A balloon payment is due at the end of a SmartBuy contract, and SmartBuy gives you several ways to cover that payment.
Using SmartBuy, you pay for the portion of the vehicle you expect to use – just like a lease – plus finance charges. The vehicle is also titled in your name. At the end of your contract, you can keep your vehicle and refinance the balloon payment, subject to credit approval in some states, or return the vehicle (and pay a disposal fee and any excess mileage and wear charges). When you buy using traditional financing, your monthly payments are paying for the whole vehicle – that can put a crimp in your budget.
- The opportunity to drive a new vehicle more often.
SmartBuy terms are often shorter than traditional financing terms, so you can drive a new vehicle more often – during its most trouble-free years.
- Low Monthly Payments.
Payments are based on the portion of the vehicle you expect to use (plus finance charges), and since SmartBuy is structured like a lease, regular monthly payments (excluding the balloon payment) are usually lower than traditional financing.
- Options at the end of your contract.
At the end of your SmartBuy contract, you have several options. You can keep your vehicle and make the final balloon payment. You can keep your vehicle and refinance the balloon payment, subject to credit approval in some states. You can sell your vehicle, keep any profit and pay off the balance. Or, you can return your vehicle and pay a disposal fee and any excess mileage and excess wear charges.
- Arranging everything conveniently through your GM dealership/retailer.
If you qualify, SmartBuy can be arranged in about an hour at your GM dealership/retailer.
What are my SmartBuy end-of-agreement options?
At the end of your SmartBuy term, you have several options. You can keep the vehicle and pay off your balloon payment balance. You can keep your vehicle and refinance the balloon payment, subject to the credit approval in some states. You can sell the vehicle, keep any profit and pay off the balance. Or, you can return the vehicle and pay a disposal fee, plus any excess mileage and excess wear charges (in most states).
Can I trade my vehicle before my SmartBuy contract ends?
Yes, but it’s to your advantage to arrange your SmartBuy contract up front, for the length of times you’re sure to keep your vehicle.
What about excess wear?
Since you may select the option of returning your vehicle at the end of your SmartBuy, keep your vehicle in good operating condition and properly maintained, and you won’t have any problems. If you keep your vehicle there will be no excess wear charges.
What about mileage?
Your SmartBuy contract will set the number of miles you may accumulate on your vehicle. There is a charge for excess miles if you return you vehicle and exceed the mileage limit. There are no excess mileage charges if you keep your vehicle.