Find record-low rates, 0% deals on auto loans

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It's a good time to be financing a new car or truck.

Interest rates are at record lows, discount auto loans are available on many models and credit is more readily available.

Even buyers with poor credit are finding it easier to borrow the money they need, although they still have to accept markedly higher interest rates.

Market-tracking website Edmunds.com says the average cost of discount loans backed by the automakers reached 4.16% in late 2010, the lowest since the site started keeping the stat back in 2002.

One reason is that almost one in six of those deals were 0% loans the best possible way to finance a new car or truck.

What if you want to buy a vehicle that doesn't come with a discount auto loan?

The average cost of conventional 36-, 48- and 60-month bank loans is right around 6%.

Shop around a little and you can find deals like this:

Bank of America is selling loans of up to 60 months for as little as 2.99% in most parts of the country.

Chase Bank has 48-month loans for 3.18% and 60-month financing for 3.43%.

Think Mutual Bank, which has branches in Minnesota but lends nationwide, is providing 12- to 60-month loans for 3.99%.

Just be aware that the lowest interest rate may not be available in all parts of the country.

Search our database of the best auto loan rates from scores of local and national lenders, and you'll find auto loans for less than 5% in most markets.

Automakers will subsidize the cost of car loans to provide a much lower, discounted interest rate on models they're anxious to move off dealer lots.

Those promotional rates are only available through the financing companies owned by, or affiliated with, the manufacturer offering the deal, such as Ford Motor Credit or Toyota Financial Services.

Of course, the best deal is a free auto loan that charges no interest at all. Here are four of our favorite models that come with 0% financing in March:

Here's where to find all the discount financing deals and rebates currently available.

Not everyone can qualify for the best auto loan rate banks or financing companies offer, though.

Requirements vary, but you can broadly figure on getting the best auto loan rates if your credit score is 740 or above. (A score of 720 is about average right now.)

But it's getting easier to obtain an auto loan with below-average credit.

Experian, one of the three big credit reporting agencies, says the number of auto loans extended to nonprime buyers (those with credit scores between 620 and 680) was up 11% in the fourth quarter of 2010 compared with 2009.

Subprime buyers (credit scores below 620) were approved for 7% more loans, so it's definitely getting easier to get an auto loan with below-average credit.

But buyers with bad credit must expect to pay more for their auto loans.

Experian says buyers with really good credit paid an average of 3.75% for a new-car loan during the fourth quarter last year, while someone with really bad credit paid an average of 13.36%.

That works out to a monthly payment of $366 a month for a 60-month loan for $20,000 for the buyer with great credit and $459 for a buyer with bad credit a $93 difference.