If you're a tad confused about what's going on with auto loans, you're not alone.

But most buyers -- particularly those who can bring a few bucks and average credit to the showroom -- can still finance a new ride on surprisingly good terms.

Not too long ago, we were buying 16 million new cars and trucks a year. Now we're buying 9 million. Maybe 10 million.

Car companies, and even some lenders, are desperate for your business.

Our most recent survey of major auto lenders found that loans for borrowers with credit scores of 700 or better cost an average of about 7%, even for five-year loans.

Shop around a little -- our extensive database of auto loan rates is a great place to start -- and you'll pay even less.

Think Mutual Bank, for example, is offering 24-month loans for 3.99%, 36-month loans for 4.09% and 60-month loans for 4.29%.

Bank of America will provide loans up to 60 months in length for about 4.5% in most places. Click here to the rate being offered in your state and apply online for a Bank of America auto loan.

Then there are all of the opportunities to take advantage of the cut-rate loans automakers are offering to clear the huge number of unsold cars and trucks off their lots.

If 0% financing is available on the model you want, you're on your way to the best loan you'll ever get.

You've probably heard about the problems plaguing some of the biggest auto-financing companies.

Chrysler Financial has stopped lending and could be liquidated.

GMAC, the bank holding company created by General Motors, needed another $7.5 billion bailout in May from the federal government to stay afloat.

But with that money in hand, GMAC's future looks quite secure, even though GM had to file for bankruptcy.

GMAC should be able to offer competitive rates and will expand to replace Chrysler Financial as a major source of loans at Chrysler, Dodge and Jeep dealerships.

Here are few final things you should know if you're buying and financing a new vehicle:

You'll probably need at least a small down payment.

Lenders are still unlikely to finance 100% of a car's purchase price -- loans they routinely made until the banking crisis struck and the recession caused more buyers to default on their auto loans.

Edmunds.com, a Web site that tracks auto sales data, reported earlier this year that the average down payment was $3,211.

Leasing won't be much of an option, particularly at GM and Chrysler dealers.

Chrysler, which had not been leasing at all since last summer, expects it to be available once again as money from GMAC becomes available.

But lease rates for almost all cars and trucks have been so awful over the past year that this hasn't been a smart alternative to buying.

If you think leasing might still be a good option for you, our 5 questions to ask before leasing can help you make sure.

If you're ready to lease, take a look at our strategy for finding the best deal.

Auto loans are still difficult to get if you have poor credit, but not quite as difficult as it was last fall.

Last year, for example, GMAC wouldn't finance anyone with a credit score below 700 -- just a few points lower than the average credit score of about 720.

But by December, GMAC resumed extending credit to those with credit scores as low as 621. In April, it said it will once again consider borrowers with subprime credit scores below 620.

Automakers are providing buyers with hefty rebates, low-interest financing or both -- something you could rarely get in the past.

The average new-vehicle incentive exceeded $3,000 for the first time this spring, and it all goes in your pocket.

Automakers also are getting more creative with their offers.

Hyundai, for example, has been successful with a new type of incentive that tries to overcome the biggest fear of many new car buyers: What if I'm laid off?

If you finance a new car or SUV through the automaker, the Hyundai Assurance program allows you to return it within the first year of ownership if you lose your job, file for bankruptcy or suffer a major illness or accident.

The program provides a $7,500 allowance to cover the difference between what you owe on the car and what it might be worth at the time you bring it back. (If the difference between what you owe and the car's resale value is more than $7,500, you must pay the additional amount.)

In May, Hyundai also rolled out an interesting new twist on the age-old rebate: Buy a new vehicle, and the company sends you a check ranging from $250 to $650. Not once, but every month for six months. Or you can take the total rebate all at once. That's what we'd do.

By Bill Visnic

Interest.com Contributing Editor