Students who have graduated colleges and universities with assistance from Federal Loans likely have a large debt to repay. If they get a job, the pay may not be enough to repay loans and other debt owed. By consolidating the debt, the graduates can have one debt to pay and focus solely on repaying that debt.
For all graduates who have a Federal Loan to repay, the Federal Government will pay off the credit card debts and add the balances to the Federal Loan balance due and adjust the monthly payment amount. The debtor also gets a cap on their credit cards around $1000 and the graduate can only have one credit card open.