(MONEY Magazine) – Uncle Sam has the perfect gift for college graduates: the lowest student-loan repayment rates in six years. Starting July 1, when the Department of Education and other lenders adjust the annual rates on college loans using formulas pegged to short-term Treasuries, graduates who have federal Stafford loans issued after July 1, 1998 can expect to pay just 6.92% interest for the next 12 months. The rate for many alums with loans issued earlier and for parents who take out new PLUS loans to help cover college costs should be 7.72%, down from 8.25%. For borrowers still in school, the interest that accrues on new unsubsidized Staffords while you're enrolled will be an even lower 6.32%. Why the drop? Low short-term interest rates and the kinder student-aid interest formulas inked in last year's education bill.

--KELLY SMITH