Ron Bloom, the U.S. Treasury's auto czar overseeing the administration's task force, also cheered the hiring of Ed Whitacre as the permanent chief executive, saying the government had no role in the decision.

As part of its bankruptcy last June paid for by $30.1 billion from the U.S. government, GM borrowed $6.7 billion and received $16.4 billion in a "restricted" fund - money that could only be spent with federal approval. GM was given five years to pay off the loan, but had to pay back any money left in the restricted account by June 30 of this year, a deadline it could request to extend by one year.

GM paid $1 billion toward the loan last month, leaving $5.7 billion outstanding. Bloom said the deal was changed Monday to drop GM's ability to extend the deadline. The automaker will also repay $1.4 billion to the Canadian and Ontario governments by June 30.

After using $3 billion of the $16.4 billion in restricted money for restructuring, whatever's left after paying off the government loans will go to GM without restrictions.

"We're glad to see GM being able to pay back the debt portion of their investment sooner than it had been forecast," Bloom said.

Bloom said the idea to lock in the loan payoff was a joint decision of GM and Treasury, and that the move showed GM was "doing better than planned."

"We have regular dialogue with GM," he said. "Both of us thought this was a good idea."

The Obama administration touted GM's move as a sign that its investments in the auto industry of some $80 billion were generating a return for taxpayers. The rescues through bankruptcy of GM and Chrysler last year still rank among President Barack Obama's least-popular decisions in polls.

Bloom said the pay of GM executives would remain under Treasury supervision after it paid off its loan, but said it wasn't clear when GM would be freed from those rules. The government owns 60.8 percent of GM's equity.

Whitacre was chosen by the auto task force to serve as GM chairman, and the task force also picked four members of GM's 12-member board of directors. Bloom said the government had left decisions such as making Whitacre a permanent CEO to the board.

"We certainly wish Mr. Whitacre well in this very challenging endeavor," he said.