Potential Bankruptcy Ahead for Ally Financial

As reported by the New York Post, Ally Financial appears to possibly be sending its mortgage unit, ResCap, into bankruptcy. Ally is facing a debt payment due May 14th which they currently do not have the funds to pay.

Ally Financial was formerly known as GMAC, until it changed its name to Ally Financial in May of 2009. A hefty bailout was given to Ally during the 2008 financial crisis, $12 billion of which is still owed to the government. Top executives of Ally have been ordered to have their annual salaries reduced by 10 percent due to the large amount of money the company still owes the US government.

An Ally spokeswoman did not comment to the New York Post regarding the bankruptcy references but speculation is still in the air as the company appears to have little to no other options with the amount of time on the table.