Debt Consolidation Calculator
The Debt Consolidation Calculator compares paying off your current debts as-is versus consolidating into a single loan, showing the new monthly payment, interest and savings.
What this means
Consolidation trades several payments for one. It helps when the new rate is lower than your average rate — but lengthening the term can erase the savings.
How we calculate it
Formula
New payment = consolidation loan's amortizing payment. Savings = current total interest − new total interest.Worked example
$20,000 in debt at an average 20% APR with $600/mo payments, consolidated at 10% for 48 months:
- 1Current payoff ≈ 50 months
- 2New payment ≈ $507 vs current $600 — saves ≈ $93/mo
- 3Interest saved over the plan ≈ $4,400
Important assumptions
- Your current payments stay fixed on the existing debts.
- The consolidation loan has a fixed rate and term.
- No new debt is added and fees are excluded.
Frequently asked questions
Does consolidation hurt my credit?
Applying can cause a temporary small dip, and closing old accounts changes your credit mix. On-time payments on the new loan typically rebuild score quickly.
When does consolidation NOT make sense?
If the new rate is not meaningfully lower, if you extend the term drastically, or if you'll keep using the cards you just paid off.