Much to the happiness of many students, interest rates on education loans have been reduced to the lowest repayment rates in student loan history.

The Pennsylvania Higher Education Assistance Agency (PHEAA) has announced that students who took out a Stafford student loan during or after July 1998 will see interest rates drop to 4.06 percent -- two percentage points less than last year.

"(The drop) will not affect my parents, since I am paying for school myself," Naomi Rogerson (senior-English) said. "I know I'll be happy though when I'm paying my loans back."

Students currently enrolled in school will receive a lower rate of 3.46 percent. A student with $10,000 in student loan debt and a 10-year payment plan will now save $1,133 in interest, according to a press release from the PHEAA.

PHEAA's KeystoneBEST Program is a two-pronged plan to skim off interest payment. If a student chooses to pay with a debit account, their interest rate will drop by 0.25 percent. Also, after 48 months of continued payment, a student's interest rate will drop two percentage points.

"This is a very affordable time for students," said Keith New, vice president of communications for PHEAA. "Right now PHEAA is offering the most affordable loan in the country to Pennsylvania students."

Also, this is the first year PHEAA is offering a Stafford loan with no up-front cost.

Parents who are helping with the cost of school will also see a lower interest rate of 4.86 percent, a drop from last year's 6.79 percent on their PLUS loan. The PLUS loan is the loan offered to parents to help pay for their students' education. The new rate will take effect for those who took out a student loan during or after July 1998.

A parent taking out a loan through Penn State will see a one percentage point drop in interest.

"Since parents are faced with immediate repayment, the loan drop will make borrowing money more appealing to parents of students," said Melissa Kunes, associate director of federal and state programs with Penn State's Office of Student Aid.

Students can access their student loan accounts online through PHEAA's Account Agency Access program at www.pheaa.org.