There are precautions that graduates and their families need to take once the decision has been made to consolidate student loans. Even before that decision is made you need to be sure you know and understand the type of student loans you currently have and that they are in fact eligible for consolidation. Private loans for instance do not qualify, therefore you cannot consolidate student loans that are financed through a private lender or organization. Federal loans are eligible and you can find out what types of programs are available for you to consolidate the student loans you have that are financed through the Government, IE: The Department Of Education.

Another word of caution is the interest rate hike about to hammer the student loan industry and affect college graduates far and wide next month on July 1st 2006. It is imperative that you understand the drastic effect an increase of this proportion will have on the amount of money you will pay if you don't consolidate your student loans now while interest rates are still low enough to have a positive impact on your monthly payments and the debt relief you've been seeking.

Last but not least is to warn you of the potential hazard of fraud that takes place in the lending industry. Many unsuspecting families get locked into bad loans or worse, ripped off. All because the companies that were chosen, while appearing legitimate were actually conducting fraudulent business transactions in the pursuit of their own wealth at the victims expense. There are a few things you can look for and know such as knowing that you should never be asked to do a credit check for a federal student loan. The request of one is a tell tale sign you are not dealing with a reputable lender.

To find out how you can spot a less than reputable company and how to protect yourself, along with a full list of Federal Student Loan Consolidation programs visit: http://www.How2Consolidate-Student-Loans.com/index.php