Welcome to July. If you're a college graduate with variable-rate student loans and you haven't consolidated them yet, do it now.

A new set of interest rates for loan consolidation just took effect July 1, and chances are you could save a lot of money in the long run.

If you have a Stafford loan, you'll be able to lock in 3.62% to 4.25% if you consolidate now. Graduate students and parents with Plus loans will be able to lock in 5.13%.

Theses new rates are only available for variable-rate federal loan debt. Keep in mind that if you have a federal loan issued after July 1, 2006, you have a fixed-rate loan and cannot lower the rate.

However, you could consolidate it with any variable rate loans that you might have. This would reduce payments to just one and you could extend the payback for 20 or 30 years instead of 10 years.

There's Always Something

Let's take a look at the "flies in the consolidation ointment."

First, due to changes made by Congress, coupled with the ongoing credit crunch, almost all student loan consolidators have shut down this business, including Sallie Mae. Congress feared that student loan consolidators were making too much money from the consolidation process. With the change in the law, student loan consolidators are no longer making enough money to be profitable and thus, are leaving the business in droves. (Your government at work!)

Dolan Straight Talk Tip: The U.S. Department of Education IS still doing consolidations, so check there first. Visit the DOE's consolidation web site for more information.

Another site we've recommended for years is StudentLoanConsolidator.com. We've talked to them recently and were impressed. Their phone number is 1-877-328-1565.

Unfortunately, those of you still attending college are out of luck. Prior to 2006, it was possible for students still in school to consolidate before graduating. But, again, thanks to Congress, you no longer have that option.

Also, if you consolidated your debts before now, these new rates do not apply to you. Consolidation is an option that is only available one time. The next course of action is to pay off your student loan debt as quickly as possible and become debt free. (For more of our advice, check out our Dolans' Debt Clinic.)

Don't Wait to Consolidate

There is no fee to consolidate federal debt, so you have no excuse to avoid this process! You should not avoid consolidating your student loan debt for fear of losing the benefits that came with your student loan originally, such as choosing from a variety of repayment options or the ability to defer payment.

Although these consolidation rates will last for the next 12 months, don't put off until tomorrow what you can do today. Get started saving right away. We'd hate to see you paying higher rates and writing multiple checks for any longer than you have to!