Finance
Debt Consolidation Calculator
Consolidation replaces several debts with one loan: new payment = (balance + fee) · i / (1 − (1 + i)^−n). Enter each balance and rate to see the new monthly payment, the total interest and fees, and how much a single loan saves — or costs — versus your current path.
Your current debts
BalanceAPR %PaymentRemove
Consolidation loan
The fixed APR on the consolidation loan
%
Years to repay the consolidation loan
years
A one-time fee, as a percent of the balance — often 0–8%
%
New monthly payment
$367.17
$113 lower each month
Total balance
$16,000
Blended APR now
22.3%
Current payment
$480
New loan amount
$16,320
Cost to consolidate
$6,030
Current interest
$9,216
Consolidating saves interest
You save about $3,186 in interest and fees, and clear the debt in 5y instead of 4y 5m.
Estimate only. The current-path figure blends your debts at their average rate; actual payoff depends on the order you pay them and any rate changes.
Try a scenario
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The basics
What is debt consolidation?
Consolidation rolls several debts into one new loan — one payment, one rate, one payoff date. Whether it helps comes down to two comparisons.
one rate beats many
It replaces a blended rate
Your debts each carry their own rate. Consolidation swaps that mix for a single rate. It only saves money when the new rate — after any fee — is below the balance-weighted average you pay now.
$16,000 at a blended 22.3% → one loan at 12.5%
lower payment ≠ cheaper
Watch the term, not just the payment
A longer term lowers the monthly payment but can raise the total interest. The payment going down feels like a win; the number that matters is the total cost over the life of the loan.
Payment falls from $480 to $367.17 a month
Method
How to work out consolidation savings by hand
Four steps take you from a pile of statements to a clear yes-or-no.
- 1
Add up what you owe
Total every balance. This is the amount a consolidation loan has to cover — the starting point for both paths.
$8,000 + $5,000 + $3,000 = $16,000 - 2
Find your blended rate
Weight each rate by its balance: multiply balance by rate, sum, and divide by the total. This is the single rate the consolidation loan must beat.
Σ(balance × rate) ÷ $16,000 = 22.34% - 3
Price the current path
Keep paying the current total each month against the blended balance. That sets the payoff time and the interest you would pay if nothing changed.
$480/mo → 4y 5m, $9,216 interest - 4
Price the consolidation loan and compare
Add any fee to the balance, then apply the level-payment formula at the new rate and term. Compare the payment and the total cost against the current path.
$16,320 at 12.5% over 60 mo = $367.17/mo
Worked examples
The same balance over 3, 5 and 7 years
$16,000 consolidated at 12.5%. A shorter term raises the payment but cuts the interest — the total cost falls sharply.
| Term | Monthly payment | Interest + fees | vs current |
|---|---|---|---|
| 3 years | $545.96 | $3,655 | saves $5,562 |
| 5 years | $367.17 | $6,030 | saves $3,186 |
| 7 years | $292.47 | $8,568 | saves $648 |
Current path: $480 a month clears the debt in 4y 5m for $9,216 of interest.
Where it shows up
When consolidation makes sense
Three situations where rolling debts into one loan tends to pay off.
high-rate cards
Escaping card APRs
Credit-card rates are among the highest consumer debt there is. Swapping them for a fixed-rate loan in the low teens is the classic, and usually the strongest, consolidation win.
Cards at 20%+ → a loan in the low teens
one due date
Simplifying payments
Multiple due dates and minimums are easy to miss. One payment on one date is simpler to manage and harder to forget — fewer late fees, less stress.
Several minimums → one fixed payment
a real end date
Getting a payoff date
Paying only the minimum on a card can drag on for years. A fixed-term loan gives a firm date the debt is gone — often the biggest psychological win.
Minimum-only cards can stretch for decades
Reference
Ways to consolidate, compared
Ordered by borrower fit, not by any payout. Each route has a different rate band and a different catch. Rates are general bands only, not a quote.
| Option | Rate band | Best for | The catch |
|---|---|---|---|
| Personal (consolidation) loan | Mid | Good credit, fixed payoff date | A fixed-rate installment loan that pays off the cards. One payment, a set end date, and usually a lower rate than a card. |
| Balance-transfer card | 0% intro, then high | Smaller balances you can clear fast | A 0% promotional rate for 12–21 months, with a 3–5% transfer fee. Only a win if you clear it before the promo ends. |
| Home equity loan / HELOC | Low (secured) | Homeowners with equity | The lowest rates, because your home secures it — which is also the risk: miss payments and the house is on the line. |
| Debt-management plan | Negotiated | Struggling to keep up at all | A nonprofit credit counselor negotiates lower rates and one payment. Not a loan; may affect access to new credit. |
CalculateThis.io is not a lender and does not make credit decisions. When we add lender links they will be marked as sponsored, and we may earn a commission if you apply through one — it does not change the rate you are offered.
Worth knowing
Five things before you consolidate
The rate is not the whole story. These decide whether it actually helps.
fees eat savings
Count the origination fee
A loan with a low rate but a high fee can cost more than a slightly higher-rate loan with none. Compare the total cost, not the headline rate.
don't re-run the cards
Address the habit
Consolidation clears the cards — but if the balances build back up, you now have the loan and the cards. The tool assumes you stop adding new debt.
secured = your house
Weigh the collateral
Home-equity options have the lowest rates because your home backs them. That is also the danger: unsecured card debt becomes debt that can cost you the house.
keep old cards open
Mind your utilization
Closing paid-off cards shrinks your available credit and can lower your score. Keeping them open with a zero balance usually helps your credit utilization.
check the term
Do not just chase a low payment
Stretching a five-year debt to seven lowers the payment but can raise the total interest. A firm, shorter payoff is usually cheaper.
fixed vs promo
Know when the rate resets
A balance-transfer card's 0% is temporary. If you cannot clear it before the promo ends, the rate can jump above what you started with.
Quick chart
Consolidation loan payment, by amount and rate
Pick an amount and read the monthly payment at each rate across three common terms. Add any origination fee to the amount first.
Amount to consolidate
Show
Monthly payment on $16,000, by rate and term.
| Rate | 3 years | 5 years | 7 years |
|---|---|---|---|
| 7.00% | $494 | $317 | $241 |
| 9.00% | $509 | $332 | $257 |
| 11.00% | $524 | $348 | $274 |
| 13.00% | $539 | $364 | $291 |
| 15.00% | $555 | $381 | $309 |
| 17.00% | $570 | $398 | $327 |
| 19.00% | $586 | $415 | $346 |
| 21.00% | $603 | $433 | $365 |
Monthly payment on a fixed-rate consolidation loan. Switch to Total interest to see the full cost of each term.
How we calculate this
The formulas and our assumptions
Two calculations sit behind the comparison — one for each path.
weighted APR = Σ(bal × rate) ÷ Σbal
The current path
We blend the debts into one balance at the balance-weighted average rate, then simulate paying your current total each month until the balance clears — giving the payoff time and total interest.
M = P·i ÷ (1 − (1 + i)^−n)
The consolidation loan
The new loan is the total balance plus any fee, priced with the standard amortizing-loan formula, where i is the new rate over twelve and n the number of payments.
- The current path blends debts at their average rate; a real payoff depends on the order you pay them.
- It assumes you keep paying the same total each month and add no new debt.
- The origination fee is financed — added to the loan amount — not paid separately.
- Cost to consolidate is interest plus fee; savings compare that against the current-path interest.
Sources
Where the method comes from
- Consumer Financial Protection Bureau — debt consolidation, credit counseling and balance transfers.
- Federal Trade Commission — coping with debt, and consolidation vs settlement.
- Standard amortization formula for a fixed-rate, fully amortizing loan.
FAQ
Common questions
It compares two paths. First it blends your debts into one balance at the balance-weighted average rate — $16,000 at 22.3% in the example — and finds how long your current $480 a month takes to clear it. Then it prices a single consolidation loan of the same balance (plus any fee) at a new rate and term, and shows the new payment, total interest and the difference. Here the loan payment is $367.17 a month.
Only if the new rate and term cost less than staying put. Consolidating the $16,000 example at 12.5% over 5 years costs about $6,030 in interest and fees, against $9,216 on the current path — a difference of $3,186. A lower rate saves money; stretching the term long can cost more even while the monthly payment drops.
Usually, yes. Rolling several payments into one loan at a lower rate typically drops the total monthly amount. In the example the payment falls from $480 to $367.17. But a lower payment is not automatically cheaper overall — a longer term can lower the payment while raising the total interest, so check both figures.
It is the average of your rates, weighted by how much you owe on each debt, so a big balance counts more than a small one. Multiply each balance by its rate, add them up, and divide by the total balance. On the example debts that is 22.34% — the single rate that behaves like your whole debt load, and the number a consolidation rate must beat.
In the short term it can dip slightly — a new loan means a hard inquiry and a new account. Over time it often helps: paying off cards lowers your credit utilization, and one on-time installment payment is easier to manage than several. Closing the old cards can hurt utilization, so many people keep them open with a zero balance.
An origination fee is a one-time charge, often 0% to 8% of the amount borrowed, usually taken out of the loan or added to it. This calculator adds it to the balance, so you finance it. On the $16,000 example a 2% fee is $320, making the loan $16,320. A fee eats into the savings from a lower rate, so compare the total cost, not just the rate.
No. Consolidation replaces several debts with one new loan you repay in full, usually at a lower rate. Debt settlement negotiates to pay less than you owe, which damages your credit and can have tax consequences. Consolidation keeps your credit intact and simply reorganises what you owe.
A personal loan gives a fixed rate and a firm payoff date, and suits larger balances you will take a few years to clear. A 0% balance-transfer card can be cheaper for smaller balances you can pay off before the promo ends — but the rate jumps high after, and there is usually a 3–5% transfer fee. The reference table on this page compares the main routes.
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Ugo CharlesBuilt and fact-checked against our editorial standards · Last updated June 2026
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