Reports have confirmed that the US Government is giving an aid of about $3.5 billion to GMAC Financial Services. This loan has been taken to do away with the losses related to its mortgage operations.

The company’s chief executive Alvaro de Molina had been asked to resign six weeks ago, and the company is currently not in position to raise capital privately to repay the government.

"As we have previously stated, GMAC has been conducting a strategic review of its business and evaluating options to address the challenges at ResCap and the mortgage operations. Critical objectives in the process would be to take actions that position GMAC for improved financial performance and to repay the U. S. Government”, said GMAC spokeswoman Gina Proia.

The firm has already taken $12.5 billion from the Government since December 2008 and had been in talks with the treasury as well as regulators regarding this in year end.

"As we stated on November 9, Treasury is in discussions with GMAC to ensure its capital needs as determined last May by the stress tests are met", said a Treasury spokesman.

No details about any specific actions to be taken have yet been shared by the company.