How the debt consolidation calculator works
Enter the balances and interest rates of the debts you want to combine, then enter the proposed consolidation loan's rate, term, and any fees. The calculator totals your current payoff cost and compares it with the single new loan — showing the difference in monthly payment and total interest side by side.
Worked example: $18,000 of card debt at 22% APR
Imagine $18,000 in credit card debt at 22% APR consolidated into an 11% personal loan over 48 months. The calculator shows a single fixed payment replacing several card minimums, with total interest far below what the 22% cards would cost. Savings depend on your payoff discipline — run your own numbers.
Debt consolidation risks to watch out for
Consolidation only works if you stop adding new debt — clearing cards and running them up again leaves you worse off. Watch for origination fees and longer terms that quietly erase the rate advantage. A lower payment stretched over many extra years can cost more overall, even at a lower rate. Estimates only, not financial advice.
When debt consolidation makes sense
It usually makes sense when the new rate is clearly lower, the payment fits your budget, and you have a plan to avoid new borrowing. It makes less sense when fees eat the savings, the term stretches so far that total interest rises, or the real problem is overspending rather than rates.
Frequently asked questions
Does debt consolidation hurt my credit score?
It can dip briefly from the hard inquiry and new account, but paying off card balances lowers your utilization, which often helps. The long-term effect depends on your behavior: on-time payments on the new loan build history, while missed payments or new card debt can undo the gains.
Is a consolidation loan better than a balance transfer card?
It depends. A 0% balance transfer card can be cheaper if you can clear the balance before the promo ends and the transfer fee is low. A consolidation loan gives a fixed rate and fixed payoff date, which suits larger balances or anyone who needs structured payments. Compare total costs in the calculator.
What fees should I check before consolidating?
Look for origination fees on the new loan, balance transfer fees on cards, and any prepayment penalties on debts you plan to close early. Add them into the calculator's fee field — a 1–5% fee on a large balance can quietly erase the interest you hoped to save.
Can I consolidate if my credit score is low?
Possibly, but options narrow. Low scores usually mean higher rates, which can wipe out the benefit of consolidating. Some lenders specialize in fair-credit borrowers. If the best rate you can get is not clearly better than your current debts, focus on a payoff plan for the highest-rate balance first instead.