Debt Consolidation Calculator

Compare your current debts with one consolidation loan. The debt consolidation calculator shows the new payment, what you save each month, and whether you save overall.

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Your current debts
New consolidation loan

Monthly savings
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Estimate only. Not financial advice.

How to use the Debt Consolidation Calculator

  1. List each debt with its Balance, Rate, and Monthly payment. Use Add debt for more.
  2. Enter the new loan's Interest rate, Term, and any Origination fee.
  3. Press Calculate. You see the monthly savings first, then the cost of keeping your debts against the cost of the new loan.

How it works

months to repay a debt: n = −log(1 − B × i ÷ P) ÷ log(1 + i)
new payment = total balance × r ÷ (1 − (1 + r)^−term)
cost now = the sum of every remaining payment on each debt
cost of new loan = new payment × term + fee
  • B, i, P: a debt's balance, monthly rate, and payment
  • r: the new loan's monthly rate

If a payment is not larger than the monthly interest, that debt would never be paid off, and the calculator says so.

Examples

  • $10,000 at 22% paid over 36 months costs $381.90 a month. Consolidated at 12% over 36 months, the payment is $332.14, saving $49.76 a month.
  • Two cards, $5,000 at 24% paying $200 and $3,000 at 19% paying $120, cost $10,849.86 to clear. One $8,000 loan at 11% over 36 months costs $261.91 a month and $9,428.75 in total.

When consolidation does not help

A lower payment is not the same as a lower cost. Spreading the same debt over more years can raise the total interest even at a lower rate. Fees can also cancel the savings. The calculator shows both numbers so you can see the trade-off before you apply.

Limitations

  • Assumes fixed rates and that you keep paying the same amount on each current debt.
  • Credit card minimum payments that shrink over time are not modelled.
  • Balance transfer offers with a 0% intro period need a different comparison.

Frequently asked questions

Does debt consolidation save money?

Only when the new rate and fees add up to less than you would pay on your current debts. Check the total cost line, not just the monthly payment.

What is an origination fee?

A one-time charge, usually 1% to 8% of the loan, that some lenders take for setting it up.

Will consolidating hurt my credit?

Applying causes a small, short dip. Paying on time afterwards usually helps your score.

Often used together with the Debt Consolidation Calculator.