Debt Consolidation Calculator – Compare Repayment Costs
Compare your current debts with a single consolidation loan.
About the Debt Consolidation Calculator
What is the Debt Consolidation Calculator?
A debt consolidation calculator compares your current debts with a single consolidated loan, showing changes to your monthly payment and total interest.
Why use this calculator?
Consolidation can simplify payments and lower the interest rate, but a longer term can mean paying more interest overall. This tool makes the trade-off visible.
How to use it
- Enter your total debt, average APR and current monthly payment.
- Enter the consolidation loan APR and term.
- Compare the payments, payoff times and total interest.
Formula
New payment from the amortizing formula; compare against current payment and interest.
Watch for origination fees and a longer term, which can erase the savings.
Frequently Asked Questions
Will consolidation hurt my credit?
Opening a new loan causes a small temporary dip, but lowering your utilization and making on-time payments usually improves your score over time.
What is the biggest risk of consolidation?
Running the cards back up after consolidating the balances, which leaves you with both the new loan and new card debt.
What is a credit utilization ratio?
It is the share of your available credit that you are using. Keep it below 30%, and ideally below 10%, to protect your credit score.
Will paying off a card hurt my score?
No. Paying down balances usually helps your score by lowering utilization. Closing the account, however, can reduce your available credit.
What is the minimum payment trap?
Minimum payments are set low, so most of the payment goes to interest and the balance lingers for years. Paying more than the minimum saves substantial interest.
Should I consolidate my debts?
Consolidation can lower your interest rate and simplify payments, but it only works if you stop adding new debt. Compare the new APR and any fees first.
What is the difference between principal and interest?
The principal is the amount you borrow. Interest is the fee charged for borrowing it, shown either as an annual rate (APR) or a periodic rate. Early payments go mostly toward interest; later payments go mostly toward principal.
How does the loan term affect my payment?
A longer term lowers the monthly payment but increases the total interest you pay over the life of the loan. A shorter term raises the monthly payment but costs less overall.
What is an amortization schedule?
It is a table that breaks every payment into its principal and interest portions and shows the remaining balance after each payment.
Should I make extra payments?
Extra payments reduce principal directly, which shortens the loan and cuts total interest. Many loans have no prepayment penalty, but check your agreement first.