GMAC LLC reported Tuesday a wider loss for the first quarter, and company officials said the amount of cheap federal funding it can potentially tap is diminishing.

GMAC, the lender affiliated with General Motors Corp. (GM), is waiting for approval from the Federal Deposit Insurance Corp. to issue FDIC-insured debt under the Temporary Liquidity Guarantee Program. Under the program's guidelines, as time passes without such approval, the amount of debt GMAC can raise decreases.

Gaining access to cheap capital through this program was a major driving force behind the cash-strapped lender's bank registration in December. The struggling auto lender faces large debt maturities this year and it hopes to use capital raised through the TLGP to repay those maturing debts.

GMAC reported a first-quarter loss of $675 million, widening from a loss of $589 million a year earlier. Its results were aided by a $631 million after-tax gain from retiring debt. Without this gain, GMAC's loss totaled about $1.3 billion amid continued harsh market conditions that drove up credit provisions and lowered revenue.

GMAC last week assumed the mantle of lender for new financing to Chrysler LLC dealers and consumers as the auto maker restructures in bankruptcy court. As part of this arrangement, the government will provide additional funding to GMAC though the size of these funds isn't yet known.

Overall, GMAC's net revenue for the first quarter fell 8.8% to $2.2 billion. Credit-loss provisions rose 78% from a year ago to $843 million.

Credit woes continued to mount for the auto unit, with 3.08% of borrowers at least a month behind their car payments, compared with 2.42% a year ago.

GMAC's mortgage business, which includes struggling subprime lender Residential Capital LLC, reported a loss of $125 million, aided by a $900 million pretax gain stemming from GMAC forgiving ResCap debt. ResCap, whose subprime-loan business blew up, has been struggling to turn around its fortunes.

GMAC now estimates that if it's approved for TGLP, it could raise between $5 billion and $10 billion. Earlier, GMAC had calculated it could raise $12 billion.

More than four months after turning itself into a bank, GMAC is still waiting for the green light from the FDIC to sell cheaply priced debt. Financial institutions ranging from Citigroup Inc. (C) to General Electric Corp.'s (GE) General Electric Capital Corp. raised financing through the program during the credit crisis.

Guidelines for the program dictate that the amount of guaranteed debt a company can issue depends on the debt maturities a company faces within a certain time period. As GMAC pays down maturing debt, the amount of funds it can issue under this plan shrinks.

GMAC said it could pay off its maturing debt this year without federal help, but doing so would probably reduce the amount it could lend consumers. The lender has $30.6 billion of debt maturing in 2009, including $11.8 billion of unsecured debt.

"When we applied for bank holding company status," said Robert Hull, GMAC's chief financial officer, "TLGP was definitely something we were seriously considering."

The company sharply scaled back lending to consumers towards the end of 2008 amid a paucity of capital. It quickened its lending pace after getting $5 billion under the U.S. Treasury's Troubled Asset Relief Program on the heels of its bank registration.

Still, lending levels remain way off from early 2008. GMAC funded 17% of GM's retail sales in the first quarter, compared with 49% a year earlier.

"We hope to get back to where we were before," said CFO Hull.

GMAC is jointly owned by GM and an investor group led by private-equity firm Cerberus Capital Management LP. The auto maker and the investor group will significantly scale back their ownership in GMAC as a condition of the lender becoming a bank-holding company.

-By Aparajita Saha-Bubna, Dow Jones Newswires; 617-654-6729; aparajita.saha-bubna@dowjones.com

(Kerry E. Grace contributed to this report.)