GMAC, the former lending arm of General Motors Corp. (NYSE: GM) has hedge fund Cerberus as its largest owner. GM still has a piece. Now, the financial firm has begun to undermine the fortunes of the car company that created it to give car loans to its customers.

According to The Wall Street Journal (subscription required), "GMAC LLC, the big home and auto financing company, this week began restricting new loans to the most credit-worthy buyers after an attempt to raise new funds failed. The move threatens to crimp General Motors Corp.'s U.S. sales, forcing the struggling auto maker to push its potential buyers to other lenders." Those "other lenders" are mostly banks, who do not want to give car purchasers any money either.

GMAC's problems are, to a large extent, because of its mortgage lending operation, but that hardly matters to GM, which is losing $1 billion a month on its North American operations. GM's unit sales are running off 20% or better compared with last year.

Last month on BloggingStocks, I wrote about a site that is an absolute must-read before you go and buy a car. Now CNN/Money has a list of their 5 mistakes to avoid when shopping for a car:

• Don't fall in love with a car.
• Avoid super-long car loans.
• Negotiate the price of the car you're buying first ... THEN negotiate the value of your trade-in.
• Avoid negotiating in person.
• Don't get hoodwinked by a sweet deal on the outgoing model year.

To these tips I would add one: Avoid getting a car loan if a loan is necessary. In other words, pick a car that you can afford to pay for with cash. If you can get a super-low interest rate deal, go for it. But pick out your car as though were paying in cash. If you can't afford to pay cash, that means you probably can't afford the car.

I realize that this may stick you in a '95 Pontiac rather than a '05 Porsche, but you'll thank me in the long run. If you ever watch the Can I afford it? segment on the Suze Orman Show, you've noticed that the people with car loans are always the ones in financial trouble.