This calculator compares old debt with a new loan
The Debt Consolidation Calculator uses current total balance, current average APR, current monthly payment, new APR, and new term. It compares total paid under the current payoff pattern with total paid under the new consolidation loan.
Current total balance sets both scenarios
The same balance is used for the existing payoff estimate and the consolidation loan estimate. That keeps the comparison focused on rate, payment, and term.
Current average APR is a simplification
If existing debts have different APRs, one average rate may hide the highest-cost balance. A weighted average is better than a casual guess.
Current monthly payment defines the old path
The calculator estimates the current payoff using the payment currently being made toward the combined debt. A temporary payment amount can mislead the comparison.
New APR creates the consolidation loan payment
The new APR is used with the selected term to calculate a fixed loan payment. That payment is then used to estimate the consolidated total paid.
New term can lower payment while raising cost
A longer term can make monthly cash flow easier while extending interest. The estimated savings line should be read beside the new payment burden and payoff time.
Origination fees are not modeled
The local solver does not add origination fees, balance transfer fees, closing costs, or prepayment penalties. Add those separately before trusting the savings number.
Estimated savings can be negative
If the new loan costs more than the current payoff path, the savings number can become a loss. That can happen when the term is much longer or fees are high.
Credit-card consolidation has behavior risk
Moving card balances into a loan does not help if the cards fill back up. Close, freeze, or discipline card use before treating consolidation as success.
The current payoff page can isolate the old path
The Debt Payoff Calculator can show the existing payoff path before comparing it with a new loan.
Credit-card balances can be estimated separately
For revolving card balances, the Credit Cards Payoff Calculator can create a combined card payoff estimate first.
APR comparison may need the APR page
If fees are the main concern, the APR Calculator can help think about annual percentage rate from finance charges.
Secured consolidation can add collateral risk
A home-equity loan, title loan, or secured personal loan can put collateral at risk. Lower interest does not automatically mean lower overall risk.
A lower payment can hide a longer obligation
Cash flow relief is useful, but it should not be mistaken for savings. Compare total paid, interest cost, and months in debt.
Prepayment ability matters
A consolidation loan with no prepayment penalty can be paid faster if income improves. A loan with restrictions may limit that flexibility.
Promotional balance transfers need deadlines
A temporary card offer can be a consolidation strategy, but the post-promotion APR and transfer fee can change the final cost.
Debt management plans are different
A nonprofit credit-counseling debt management plan may lower rates without creating a new loan. This calculator assumes a new consolidation loan.
Credit score impact is not predicted
A new loan can affect credit inquiries, utilization, account age, and payment history. The calculator does not estimate score changes.
Use real loan offers when possible
Prequalified rates are not always final. Use an actual loan disclosure or firm offer before deciding that consolidation saves money.
Do not ignore variable-rate risk
Some consolidation products have variable rates. If the new APR can rise, the fixed estimate may understate future cost.
Include debts only if they will actually be consolidated
If a debt stays outside the new loan, it should not be part of the balance comparison. Mixing included and excluded debts makes the result confusing.
Watch for insurance products
Optional credit insurance, protection plans, or add-ons can raise cost. The solver does not add them unless the user includes them outside the fields.
Interest savings should survive fee adjustment
A consolidation offer that saves interest before fees may not save money after fees. Add fees to the consolidated total paid before deciding.
Monthly cash flow can still matter
Even if total cost rises slightly, a borrower may need payment relief to avoid missed payments. The calculator shows cost, not personal emergency needs.
Use the new payment in the budget
The new loan payment should be tested in a monthly budget. A consolidation plan that is still unaffordable will not solve the debt problem.
Payoff discipline should be planned first
Before consolidating, decide how old accounts will be handled, how spending will be controlled, and whether the new loan payment will be automated.
Student loans need special caution
Refinancing federal student loans into private debt can remove federal protections. Use the Student Loan Calculator for payment math, then verify repayment options separately.
Tax debt and court debt may not fit
Tax obligations, judgments, child support, and court fines can have special legal consequences. Do not treat them like ordinary unsecured balances without advice.
A consolidation loan can create a false reset
Seeing card balances at zero can feel like the problem ended. The debt still exists on the new loan until payments finish.
Debt settlement is not consolidation
Settlement aims to pay less than owed and can create credit, tax, and legal issues. This page compares full payoff paths.
Compare lender terms beyond APR
Payment due dates, late fees, autopay discounts, origination fees, prepayment rules, and hardship options can make two loans with the same APR feel different.
Use exact months for the new term
The new term field is in months. A five-year consolidation loan should be entered as sixty months.
A short term can raise the payment
A shorter consolidation term can save interest but increase monthly pressure. The result should be checked against actual cash flow.
A long term can delay freedom
A long consolidation term may keep the borrower in debt even after the original plan would have ended.
Keep a copy of the old-debt list
Save balances, APRs, minimum payments, and payoff assumptions before consolidation. That record explains what was compared.
Run the calculator again after approval
If the approved APR or term differs from the expected offer, rerun the numbers before signing.
Use consolidation as a tool, not a cure
The calculator can show whether a new loan improves the math. Long-term success still depends on payment discipline and avoiding new high-interest balances.
Read the loan agreement before closing
The contract controls the real rate, fees, payment schedule, default terms, and prepayment rights. Calculator savings should never replace that review.
The best result is lower cost and a realistic payment
A strong consolidation plan lowers total cost, creates a payment the borrower can repeat, and prevents old balances from returning.
Document the comparison date
Rates and offers change. Save the calculation date, current payoff assumptions, new APR, new term, and any fees considered outside the page.