Oct. 14 (Bloomberg) -- GMAC LLC, the financing arm of General Motors Corp., has ``limited if any access to funding'' for its mortgage and auto-lending units, Chief Executive Officer Al de Molina said in an e-mail today to employees.

GMAC may trim auto lending in some international markets, de Molina said in the e-mail. The Detroit-based company is considering ``strategic initiatives'' for insurance businesses, he said.

``We've pursued a `self-help' approach that on some days is akin to hand-to-hand combat,'' de Molina said in the e-mail. He said the lender's Residential Capital LLC unit is ``perhaps the most challenged operation.'' GMAC doesn't comment on employee communications, spokeswoman Gina Proia said.

GMAC said yesterday it's restricting auto lending to buyers with credit scores of at least 700, who represent about 58 percent of U.S. consumers. The move added to the global credit squeeze that threatens to choke economic growth as companies and consumers find it harder and more expensive to borrow. Plummeting auto sales and record foreclosures have resulted in $5.4 billion in losses at GMAC over the past year and led credit agencies to reduce the debt to junk.

``It's very difficult for a finance unit to exist very long at less than investment grade,'' said Thomas Atteberry, who helps manage $3.5 billion in fixed-income assets at First Pacific Advisors in Los Angeles. ``The cost of capital is just a killer.''

Cerberus

Cerberus Capital Management LLC, which bought 51 percent of the lender from GM in 2006, ``may evaluate new and creative solutions to the problems brought about by the current environment,'' de Molina said. ``There has been no decision to change GMAC's ownership structure at this time.''

GMAC provided 43 percent of GM's second-quarter auto loans. GMAC yesterday raised the rate it charges auto dealers for making loans that aren't part of special incentive programs by 0.75 percentage point. Most loans will be limited to 60 months.

Automotive finance made up 42 percent of GMAC revenue in 2007, up from 29 percent a year earlier. Insurance rose to 42 percent from 38 percent in the previous year.

Chrysler Financial, the finance arm of Cerberus-owned Chrysler LLC, hasn't changed its auto-lending standards, spokeswoman Amber Gowen said yesterday.

GMAC's mortgage lending unit, ResCap, has reported seven straight money-losing quarters amid the worst housing crisis since the Great Depression. ResCap CEO Thomas Marano is working on a ``three-prong'' approach to revive the business, including work on ``revenue-generating strategies for the current marketplace'' and improving communication among employees, de Molina said.

To contact the reporters on this story: David Mildenberg in Charlotte at dmildenberg@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net.

Last Updated: October 14, 2008 20:47 EDT