Debt consolidation calculator: does one loan really save?
Enter up to four current debts and one consolidation loan. Compare total interest, fees, payoff dates and the monthly payment, including when consolidating costs more.
A consolidation loan can lower the monthly payment by stretching the term. That feels like saving, but the total interest can rise. This tool compares both paths with the same repayment rules.
Your assumptions
Interest and fees on the new loan are USD 2,295, compared with USD 3,131 interest if you keep paying the current debts as entered.
| Measure | Keep current plan | Consolidate |
|---|---|---|
| Monthly payment | USD 325.00 | USD 214.48 |
| Debt-free in | 3 yr 3 mo | 4 yr |
| Debt-free around | Jan 2030 | Oct 2030 |
| Interest | USD 3,131 | USD 2,135 |
| Fees | USD 0 | USD 160 |
| Total paid | USD 11,131 | USD 10,295 |
How the calculation works
Current: Interest_m = Balance × APR / 12, repaid with your payment until zero. New loan: Payment = P × r / (1 − (1 + r)^−n). Saving = current interest − (new interest + fees)Each current debt is repaid month by month with its own rate and payment until it reaches zero. The consolidation loan borrows the combined balance (plus a fee if it is added to the loan) and is repaid in equal monthly installments over its term.
Step by step
- For every current debt: add one month’s interest (APR ÷ 12), subtract the payment, repeat until the balance is zero. Sum the interest of all debts.
- Consolidation amount = sum of balances; with a financed fee, plus the fee. A fee paid upfront is counted as a cost but not borrowed.
- New payment = installment formula; new interest = payment × term − amount borrowed.
- Saving = current interest − new interest − fee. A negative saving means consolidating costs more.
- Debt-free dates count months from today for each path; the current path ends when the last debt is repaid.
Limitations
Assumes fixed rates and payments, no new borrowing, no early repayment fees and monthly interest. Credit cards may use daily balances and minimum-payment formulas. Eligibility, rates and fees depend on the lender and your country. Default values are invented examples. Illustration, not advice or an offer.
Questions, answered.
Why can a lower monthly payment cost more?
A longer term means you pay interest for longer. Compare total interest and fees, not only the monthly payment.
What if I keep paying the old monthly amount on the new loan?
Paying more than the required payment usually shortens the term and cuts interest. Check whether the lender charges for early repayment.
Does closing old cards matter?
Repaid credit lines that stay open can be used again. Running the balances back up would undo the saving.
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