I use a GM Mastercard that earns a rebate on the purchase of a GM car. I have accumulated a substantial rebate. If GM enters bankruptcy, could this affect my rebate?

The short answer is yes. In a Chapter 11 filing, which is reorganization, the court can eliminate any unsecured debt as requested by the debtor. The longer answer is that as long as there is a viable General Motors, those GM rebate dollars are probably secure.

Although I wouldn’t want to predict the exact final outcome, the truth is GM is probably not going anywhere. It may be streamlined even further with fewer vehicle brands — giving you fewer choices in spending those rebate dollars — and it may have a major investor sharing ownership with its shareholders, but in all likelihood, GM in some form or fashion will be around for decades to come. Even if accumulated rebate funds tied to the HSBC GM MasterCard are considered by the bankruptcy court as a debt, GM sees the money as promotional. It is in business today and will be in business down the road to sell vehicles. Those rebate dollars you have accumulated are designed to propel you into a GM showroom and provide some extra incentive to buy something. The rebate only becomes an issue when you buy a GM product. They want you to buy a GM product and are willing to offer you that rebate as a discount to motivate you to do so. Although I can’t see into the mind of GM, it is hard to imagine they would ask the court to wipe out that rebate program if reorganization occurs.

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