The company was founded in 1919 by General Motors as the General Motors Acceptance Corporation to provide financing to automotive customers. In 1939, the company founded Motors Insurance Corporation and entered the vehicle insurance market. In 1985, while GM was under the leadership of Roger Smith, who sought to diversify the company, GMAC formed GMAC Mortgage and acquired Colonial Mortgage as well as the servicing arm of Norwest Mortgage, which included an $11 billion mortgage portfolio. In 1991, the company was forced to write-off $275 million in bad debt as part of a $436 million loss suffered from fraud committed by John McNamara, who ran a Ponzi scheme. In 1998, the company formed GMAC Real Estate. In 1999, GMAC Mortgage acquired Ditech. In 2000, the company formed GMAC Bank, a direct bank. In 2005, the company formed GMAC ResCap as a holding company for its mortgage operations. In 2006, General Motors sold a 51% interest in GMAC to Cerberus Capital Management, a private equity firm. Also that year, GMAC sold a controlling interest of GMAC Commercial Holdings to Goldman Sachs, Kohlberg Kravis Roberts, and Five Mile Capital Partners. GMAC Real Estate was sold to Brookfield Asset Management. In 2009, Capmark filed for bankruptcy and its North Americanloan origination and servicing business was acquired by Berkadia, a joint venture of Leucadia National and Berkshire Hathaway. On December 24, 2008, the Federal Reserve accepted the company's application to become a bank holding company. In January 2009, the company shut down Nuvell Financial Services, its subprime lending division. As a result of losses in GMAC ResCap, the United States Department of the Treasury invested $17.2 billion in the company in 2008–2009. The Treasury sold its last stake in the company in 2014, recovering $19.6 billion from its $17.2 billion investment. In May 2009 GMAC Bank was rebranded to become Ally Bank. In May 2010, GMAC re-branded itself as Ally Financial. In September 2010, the company sold its resort finance business to Centerbridge Partners. In 2012, the company sold its Canadian banking operations to Royal Bank of Canada for $3.8 billion. In April 2014, it became a public company via an initial public offering. In 2015, it moved its headquarters to One Detroit Center, which was subsequently renamed Ally Detroit Center. In June 2016, the company acquired TradeKing, a stockbrokerage, for $275 million, which was re-branded as Ally Invest. In May 2016, Ally Bank re-entered the mortgage business with the launch of its direct-to-consumer offering called Ally Home. In April 2019, Ally Home partnered with Better.com to launch a digital mortgage platform. In 2016, the company moved more than 1,500 employees to 13 floors of Ally Detroit Center. In 2017, Ally signed a lease for 400,000 square feet at the Ally Charlotte Center in Charlotte, North Carolina, scheduled to be completed in 2021, and will move its offices from 440 South Church. In 2020, the company reported a net loss for the first quarter of the year, reportedly due to the Coronavirus recession. The company was the first large bank in the United States to report a net loss, claiming a net loss of roughly $319 million. By contrast, the company reported a net income of $374 million in the first quarter of 2019.
In December 2013, the Consumer Financial Protection Bureau and United States Department of Justice ordered the company to pay $80 million in consumer monetary damages and $18 million in civil penalties after determining that 235,000 minority borrowers paid higher interest rates for auto loans originated between April 2011 and December 2013 because of the company's discriminatory pricing system. The higher rates resulted from the company's specific policy of allowing dealers to charge, at their discretion, a "dealer markup" above Ally's established "buy rate" and then compensating dealers based on the markup. Ally provided an incentive for dealers to charge higher rates, which disproportionately affected minority borrowers, in violation of the Equal Credit Opportunity Act.
