Debt Consolidation Calculator
Your Current Debts
Proposed Consolidation Loan
Current Debts
Total Monthly Payment
$0
Total Interest (over life of debts)
$0
Total Amount Paid
$0
Consolidation Loan
New Monthly Payment
$0
Total Interest
$0
Total Amount Paid
$0
Monthly Savings
$0
Total Interest Saved
$0
Understanding Debt Consolidation
Debt consolidation is the process of combining multiple debts into a single loan, ideally with a lower interest rate and a fixed repayment schedule. This calculator lets you enter all your current debts — credit cards, personal loans, medical bills, or any other obligations — along with their balances, interest rates, and monthly payments. Then you specify the terms of a proposed consolidation loan to see a side-by-side comparison.
The calculator computes the total interest you would pay on your existing debts if you continued making current payments, then compares that to the total interest on a new consolidation loan. It shows your monthly savings, total interest saved, and whether consolidation makes financial sense for your specific situation. A lower monthly payment is appealing, but always check the total interest — a longer term can mean paying more overall even with a lower rate.
Common consolidation options include personal loans from banks or credit unions (typically 6-36% APR depending on credit score), balance transfer credit cards (0% intro APR for 12-21 months), home equity loans or HELOCs (lower rates but secured by your home), and debt management plans through nonprofit credit counselors. Each option has trade-offs in terms of rates, fees, and risk that should be weighed carefully before proceeding.
Frequently Asked Questions
What is debt consolidation?
Debt consolidation combines multiple debts — such as credit cards, personal loans, and medical bills — into a single loan with one monthly payment, often at a lower interest rate. This simplifies your finances and can reduce the total interest you pay over time. Common methods include personal consolidation loans, balance transfer credit cards, home equity loans, and debt management plans.
What are the pros and cons of debt consolidation?
Pros include a potentially lower interest rate, simplified payments (one instead of many), a fixed payoff timeline, and possible improvement to your credit score over time. Cons include possible origination fees or closing costs, the temptation to run up new debt on paid-off cards, potentially longer repayment terms that increase total interest despite a lower rate, and the risk of using secured assets (like your home) as collateral.
When should I consolidate my debts?
Consolidation makes the most sense when you have multiple high-interest debts (especially credit cards at 20%+ APR), you can qualify for a consolidation loan at a meaningfully lower rate, you have stable income to make the new payments consistently, and you are committed to not accumulating new debt. If the new rate is only slightly lower or the term is much longer, consolidation may not save you money.
Does debt consolidation hurt your credit score?
Initially, applying for a consolidation loan may cause a small, temporary dip in your credit score due to the hard inquiry. However, over time, consolidation can improve your score by reducing your credit utilization ratio (as credit card balances are paid off), establishing consistent on-time payments, and reducing the number of accounts with balances. The key is to avoid running up new balances on the cards you paid off.