Your Comparison
Your Current Debts
New Consolidation Loan
What is a debt consolidation calculator?
A Debt Consolidation Calculator compares what you pay on your current debts with what you would pay on a single new loan that replaces them. It shows both monthly payments, the time to become debt-free and the total interest, including any origination fee, so you can see whether consolidating would actually save money. It is useful for anyone juggling several credit cards or loans.
How to use it
- List each current debt with its balance, monthly payment and APR. Click + Add another debt for more.
- Enter the rate and term you have been quoted for the consolidation loan, plus any origination fee.
- Click Calculate to see your current debts and the new loan side by side.
Debt consolidation formula
The new loan’s payment uses the standard installment formula:
M = P × r(1 + r)^n ÷ ((1 + r)^n − 1)
where P is the total balance being consolidated, r is the monthly rate (APR ÷ 12) and n is the term in months. Your current debts are projected month by month using the payments you enter, which gives the time to debt-free and total interest if nothing changes.
Example
Consolidating $50,000 into a loan at 10% for 5 years gives a payment of about $1,062 a month and about $13,741 in total interest. Enter your current cards and loans above it to see whether that beats your present plan. With a 5% origination fee, add $2,500 to the cost.
Monthly payment vs. total cost
A consolidation loan with a longer term can lower your monthly payment while still costing more overall, because you pay interest for longer. Always compare three numbers: the monthly payment, the total interest and the total amount repaid including fees.
What affects your consolidation rate?
The rate you are offered depends mainly on your credit score, income, debt-to-income ratio, the loan amount and the term. Consolidation saves money only if the new rate (including fees) is lower than the average rate on the debts you are replacing.
Tips
- Close or freeze the cards you pay off, or at least stop using them, so the balances do not build up again.
- Check for prepayment penalties and origination fees before you sign.
- Compare a consolidation loan with paying debts down directly using the Debt Payoff Calculator.
- A 0% balance transfer card can work for smaller balances, but watch the transfer fee and the rate after the promotion ends.
Frequently Asked Questions
At 10% APR, a $50,000 consolidation loan costs about $1,062 a month over 5 years, about $1,613 over 3 years or about $830 over 7 years. Your rate and term decide the payment.
Applying usually causes a hard inquiry, which can lower your score slightly for a short time. Over time, paying the new loan on time and lowering your card balances can help your credit.
It makes sense when the new loan’s rate, including fees, is clearly lower than your current average rate, the payment fits your budget, and you will not run the old cards back up.
List each card’s balance, rate and minimum payment. Then compare paying them down directly (highest rate first) with a consolidation loan at the rate you can get. For example, a $40,000 loan at 12% for 5 years costs about $890 a month.
It can provide a useful estimate based on the information entered. Actual loan payments can differ because lenders may offer different rates, fees, and terms.
Disclaimer: This calculator gives estimates for general information only. It is not financial, tax or legal advice. Results depend on the numbers you enter and on simplified assumptions, so your actual figures may differ. Check important decisions with a qualified professional or the official source.
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