Debt Consolidation Calculator: Will One Loan Save You Money?
List up to three debts with their balances, APRs, and minimum payments, then set the rate and term of the loan that would replace them. You'll see both paths side by side: monthly payment, total interest, and months to debt-free.
The rate on the loan that would replace these debts
How long the new loan runs
Current monthly minimums
$310
across 2 debts totaling $10,300
New consolidated payment
$340
$30 more per month, but for a fixed 3 years
Verdict
Saves $4,872
in interest, debt-free 1 year 10 months sooner
Both paths, side by side
| Keep current debts | Consolidation loan | |
|---|---|---|
| Monthly payment | $310 | $340 |
| Total interest | $6,800 | $1,928 |
| Debt-free in | 4 years 10 months | 3 years |
| Total paid | $17,100 | $12,228 |
The current path holds each minimum payment steady until its debt clears. Consolidation assumes the full $10,300 moves to the new loan and the old accounts stay at zero; origination fees, if any, would add to the loan side.
What the comparison actually measures
The current path holds each debt's minimum payment steady until that balance reaches zero, accruing interest at its own APR every month along the way. The consolidation path adds your balances together and amortizes them as one fixed loan: a set payment, a set rate, a set end date. Comparing the two means comparing total interest and time, not just the size of the monthly check. A smaller payment on a longer loan can cost more in the end, which is exactly the trap the side-by-side table exists to catch.
A realistic before and after
Take the calculator's starting numbers: a $6,500 card at 24.99% with a $195 minimum and a $3,800 card at 21.99% with a $115 minimum. Held steady, those payments take 58 months to finish and accrue about $6,800 in interest on $10,300 of debt. Move both balances to a 36-month consolidation loan at 11.5% and the payment becomes about $340, roughly $30 more per month than the combined minimums, but the interest bill falls to about $1,900 and the debt ends 22 months sooner. That is a saving near $4,900, bought with a modestly higher payment and a much lower rate.
The two ways consolidation goes wrong
First, the rate does not really drop. An origination fee of 1-10% comes out of the loan, so a new APR that only edges below your old weighted average can be a wash or worse. Second, and far more common: the cards that just went to zero start filling up again. Then you carry the loan and fresh card balances at the same time, which is how consolidation earns its bad reputation. The move only works as the ending of a borrowing chapter, not a refinancing of it. Watching your credit utilization stay low after the payoff is a good tell that it is working.
Where this fits among your options
If your rates are already low or your balances are small, simply attacking them in a smart order can beat a new loan: the debt payoff calculator runs both the snowball and avalanche orders on your real numbers. If a loan does win, price it first with the personal loan calculator so you walk in knowing what the payment should be.
Frequently asked questions
How does debt consolidation work?
You take out one new loan, use it to pay off several existing balances, and then make a single fixed payment on the new loan. Nothing is forgiven; the debt just moves. The win, when there is one, comes from a lower interest rate and a fixed end date replacing open-ended minimum payments.
When does consolidation actually save money?
Two conditions have to hold. The new APR must be meaningfully below the rates on the debts it replaces, and the old accounts must stay at zero afterward. If the rate barely drops, or the cards fill back up, consolidation quietly becomes more debt at a longer term.
Does debt consolidation hurt your credit score?
Typically there is a small short-term dip from the hard inquiry and the new account, and often a medium-term improvement: installment loans do not count toward credit utilization, so paying cards to zero with a loan can drop utilization sharply. The pattern varies by profile, so treat this as an educational generalization.
What rate should a consolidation loan beat?
The weighted average APR of the debts you would fold in, weighted by balance. If most of your balance sits at 22-25%, a loan in the low teens usually clears the bar even after an origination fee. If your debts are already cheap, a new loan rarely wins on interest alone.
Should car loans or student loans go into a consolidation?
Usually not. Consolidation shines on high-rate unsecured balances like credit cards. Auto loans are typically cheaper and secured by the car, and federal student loans carry protections and flexible repayment options that a private consolidation would erase.
Does this calculator save my numbers?
No. Everything runs in your browser and nothing you type is stored or sent anywhere.
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