Debt Consolidation Calculator
Compare up to four debts against one consolidation loan — new payment, total interest each way, and an honest verdict on whether a longer term wipes out the savings.
Debt Consolidation Calculator: with the default inputs, new monthly payment is $367.44.
Only the first N are used. The fourth lives under More options.
Deducted from the proceeds, so you borrow a little more than your balances to clear them.
- What you pay now
- $480
- Monthly difference
- -$112.56Negative means the new payment is lower.
- Does consolidating save money?
- Yes — consolidating saves $1,104 over the life of the debt, and drops the payment by $113 a month.
- Lifetime saving (negative = it costs more)
- $1,104
- Interest if you keep paying as you are
- $7,451
- Interest on the consolidation loan
- $6,347Includes the origination fee, which you borrow and repay.
- Total balance today
- $15,700
- Balance-weighted rate today
- 19.74%
- Debt-free date as you are
- 4 years, 6 months
- If you keep paying the old total
- 3 years, 7 monthsHow fast the consolidation loan disappears if you don't pocket the lower payment.
Assumptions
- Current payments stay level until each balance is cleared, with no new charges.
- The consolidation loan is fixed-rate, fully amortizing, with the fee deducted from the proceeds.
- Interest on each existing debt is simple interest on the declining balance at its stated rate.
- No balance-transfer promotions, late fees or penalty rates are modelled.
| Plan | Monthly payment | Months | Interest paid | Total paid |
|---|---|---|---|---|
| Keep paying as you are | $480.00 | 54 | $7,450.86 | $23,150.86 |
| Consolidation loan | $367.44 | 60 | $6,346.60 | $22,046.60 |
| Debt | Balance | Rate | Payment | Months left | Interest to come |
|---|---|---|---|---|---|
| Credit card 1 | $8,500 | 22.9% | $255.00 | 54 | $5,137 |
| Credit card 2 | $4,200 | 18.5% | $130.00 | 46 | $1,657 |
| Store card | $3,000 | 12.5% | $95.00 | 39 | $657 |
How this is worked out
The formula
For each debt: months = −ln(1 − balance × i ÷ payment) ÷ ln(1 + i), i = rate ÷ 12
interest = payment × months − balance
Consolidation: amount borrowed = total balance ÷ (1 − fee %)
payment = amount × i(1 + i)^n ÷ ((1 + i)^n − 1)
interest = payment × n − total balance (the fee is borrowed, so it counts)
Saving = (total balance + current interest) − (payment × n)Open How it’s calculated above to see this worked through with your own numbers.
What you enter
- How many debts?
- Only the first N are used. The fourth lives under More options.from 1 to 4 · whole numbers only · defaults to 3
- Credit card 1 — balance
- A number.in dollars · 0 or more · defaults to 8500
- Credit card 1 — rate
- A number.a percentage · from 0 to 100 · defaults to 22.9
- Credit card 1 — monthly payment
- A number.in dollars · 0 or more · defaults to 255
- Credit card 2 — balance
- A number.in dollars · 0 or more · defaults to 4200
- Credit card 2 — rate
- A number.a percentage · from 0 to 100 · defaults to 18.5
- Credit card 2 — monthly payment
- A number.in dollars · 0 or more · defaults to 130
- Store card — balance
- A number.in dollars · 0 or more · defaults to 3000
- Store card — rate
- A number.a percentage · from 0 to 100 · defaults to 12.5
- Store card — monthly payment
- A number.in dollars · 0 or more · defaults to 95
- Debt 4 — balance(under More options)
- A number.in dollars · 0 or more · defaults to 0
- Debt 4 — rate(under More options)
- A number.a percentage · from 0 to 100 · defaults to 0
- Debt 4 — monthly payment(under More options)
- A number.in dollars · 0 or more · defaults to 0
- Consolidation loan rate
- A number.a percentage · from 0 to 100 · defaults to 12.9
- Consolidation loan term
- A number.from 6 to 180 · whole numbers only · defaults to 60
- Origination fee
- Deducted from the proceeds, so you borrow a little more than your balances to clear them.a percentage · from 0 to 12 · defaults to 3
What you get back
- New monthly paymentmain answer
- What you pay now
- Monthly difference
- Negative means the new payment is lower.
- Does consolidating save money?
- Lifetime saving (negative = it costs more)
- Interest if you keep paying as you are
- Interest on the consolidation loan
- Includes the origination fee, which you borrow and repay.
- Total balance today
- Balance-weighted rate today
- Debt-free date as you are
- If you keep paying the old total
- How fast the consolidation loan disappears if you don't pocket the lower payment.
What this assumes
- Current payments stay level until each balance is cleared, with no new charges.
- The consolidation loan is fixed-rate, fully amortizing, with the fee deducted from the proceeds.
- Interest on each existing debt is simple interest on the declining balance at its stated rate.
- No balance-transfer promotions, late fees or penalty rates are modelled.
About this calculator
Consolidation replaces several debts with one loan. The pitch is always the same — one payment, a lower rate, less stress — and the arithmetic is often less flattering than the pitch, for one reason: a lower rate over a longer term can still cost more.
The term trap
Interest is a rate multiplied by a balance multiplied by time. Consolidation reliably cuts the first term and reliably raises the third. Three cards at 22.9%, 18.5% and 12.5% that you'd clear in 53 months might become a 60-month loan at 12.9% — that saves money. Stretch the same loan to 84 months and the payment drops another $70, while the total cost rises by roughly $1,600. The monthly number improves in both cases; only one of them is cheaper.
This calculator computes both totals so you can see which case you're in. The verdict line says plainly whether the money works, and warns you when the term is doing the heavy lifting rather than the rate.
How to use it
Enter each balance, its rate, and what you actually pay each month — not the minimum, unless the minimum is what you pay. That's what determines how fast the debt disappears today. Then enter the loan you've been offered: rate, term, and origination fee. Fees on consolidation loans usually come out of the proceeds, so you have to borrow slightly more than your balances to clear them; the calculator handles that.
Reading the results
- Monthly difference is the cash-flow effect. Negative is a lower payment.
- Savings is the lifetime effect, and it's the one that matters. Negative means consolidating costs you more overall.
- If you keep paying the old total is the most useful line on the page. Take the loan, then keep paying what you were paying — the loan disappears years early and you capture the rate cut without the term penalty.
The parts arithmetic can't model
- Behaviour. Consolidating cards and then using them again is the standard failure mode. The debt doesn't move; it multiplies.
- Secured versus unsecured. A home equity loan usually has the lowest rate because your house is the collateral. Converting unsecured card debt into debt secured by your home changes what happens if things go wrong.
- Credit score effects. A new loan is a hard inquiry and a new account, which dings the score short term; paying cards to zero cuts utilization, which usually helps more.
- 0% balance transfers are a different product: no interest for 12–21 months, a 3–5% transfer fee, and a rate that snaps back afterwards. If you can clear it inside the promo window, it usually beats a consolidation loan.
Frequently asked questions
▸Does debt consolidation actually save money?
Only when the interest saved by the lower rate is bigger than the interest added by the longer term. Compare the two total-cost figures, not the two payments. A lower payment on a longer term frequently costs more.
▸Will consolidating hurt my credit score?
Briefly. The hard inquiry and new account lower it a little, while paying revolving balances to zero cuts your credit utilization, which usually raises it more. The net effect after a few months is often positive as long as you don't re-borrow on the cards.
▸Is a balance transfer better than a consolidation loan?
If you can pay the balance off within the 0% promotional window, usually yes — you pay a 3–5% transfer fee instead of a year or more of interest. If you can't, the post-promo rate is often higher than a loan rate and you're worse off.
▸Should I use a home equity loan to consolidate?
The rate is lower because your house secures the debt. That is the entire trade: unsecured debt you could negotiate or discharge becomes debt that can cost you the house. Do it only with a payment you're certain of.
▸What if my minimum payment doesn't cover the interest?
Then that balance grows forever and no payoff date exists. The calculator flags it. Any fixed-term loan is better than that situation, which is why credit card minimums are set just above the interest line.
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