Debt Consolidation Calculator

The three debts line by line, and the loan that replaces them

Before the verdict, the receipt. Each existing debt is run at its own minimum until it clears; the last row is what the tool proposes instead.

The credit card carries 52% of the balance but 66% of the interest — it, not the higher-rate store card, is what consolidating is really buying out.

Read the bottom two rows against each other first. Kept as they are, these three cost $5,923.53 in interest and the slowest of them runs 54 months; replaced by one loan at 11.5% over 48 months, interest falls to $3,153.28, the finish arrives 6 months sooner, and the payment lands $73.89 a month under the combined minimums. That is consolidation winning on payment, time, and interest at once — the uncommon case, since moving one input usually flips one of the three. The per-debt rows make it visible: they show which balance drives the total, and they mark any debt that would never clear on its own minimum rather than quoting it a payoff date.

Where a minimum payment stops being a payoff plan

Two different clocks run here. The new loan is one closed-form amortization: a fixed rate, a fixed term, one payment clearing the combined balance of every debt you enter, plus the fee if you roll one in. Your existing debts get a clock each instead, run in parallel at their own fixed minimum until the last is clear. The tool does not reorder those payments the way a snowball or avalanche strategy would, and it does not roll a cleared debt’s payment into the next one.

The second formula is the one that breaks, at an exact threshold: once the minimum payment A is at or below the interest that balance charges in a month, the logarithm takes an argument that is not positive, the balance never shrinks, and no payoff month exists to solve for. Rather than print a misleading date, the tool marks that debt Never in the months column and keeps it out of the combined payoff time. A balance stuck there is the strongest case this calculator can make for consolidating, since a loan that actually amortizes may be the only thing that clears it.

That parallel-minimums baseline is also what separates this page from the Debt Payoff Calculator: use this one to weigh replacing your debts with a new loan, and that one to find the fastest or cheapest order to attack the debts you keep — snowball, avalanche, or your own — which it simulates month by month rather than solving the closed form used here.

How far you can stretch the term before consolidating stops saving

Same $12,500 at 11.5%, only the term moving, measured against the $5,923.53 of interest and $400 of minimums you pay by keeping the debts.

The comparison panel above sets those two worlds side by side across four numbers — monthly payment, time to debt-free, total interest, total cost — coloring each green where consolidating wins the line and red where it loses. The four do not move together, which is why there are four: a longer term buys a smaller payment out of a larger interest bill. Green on the payment line and red on the interest line is not a contradiction, it is the price tag on that smaller payment, and the summary line underneath says which way the trade fell. The table below moves only the term, so you can see where the flip lands.

The payment falls on every row; the saving does not. Even at a rate 8.8 points below the blended one you carry now, the crossover arrives between 84 and 96 months — $167.81 still saved at 84, $751.51 extra at 96. Past that point the smaller payment is bought with more interest, not less.

So no, consolidating does not always save money, and whether it is a good idea is a question about these numbers rather than a blanket rule. It helps when the new rate sits meaningfully below the blended rate you already carry and the term is not stretched so far that total interest climbs — the two conditions this table holds against each other. Taking the smaller payment anyway is legitimate when cash flow is the problem you are solving; just make that choice knowing what the interest column costs.

How long an origination fee takes to earn itself back

On the 48-month loan the payment drops $73.89 a month, so a fee paid in cash has a payback period. A financed fee has none — it rides the whole term at 11.5% instead. Either entry is available above: rolled into the loan balance, where it is borrowed along with everything else, or handed over at closing, where it is cash out of pocket and is not deducted from what your old debts get paid.

Financing a 5% fee adds $782.88 to the loan against $625 handed over at closing — the $157.88 difference is interest charged on the fee itself. Paying it in cash instead is recovered in 9 months of the lower payment.

The APR you type is a guess until a lender prices you

Every figure here runs off the rate and term you entered, and none of it is a lender quote, a pre-approval, or a loan offer. The tool does not guarantee approval, an APR, or any term — real offers depend on your credit profile and the lender, and a rate a point or two worse than the one you modeled can shrink or erase the whole saving above. Weaker credit is usually priced rather than refused: banks, credit unions, and online personal-loan lenders all write these, normally as an unsecured personal loan, and some specialize in fair or bad-credit consolidation at an APR high enough to change the answer. A nonprofit credit counselor is worth a call before you accept one.

The model also holds every rate flat. It does not account for a promotional or variable rate on your existing debts or on the new loan, so a card on a teaser rate that expires next year is treated generously here. Nor does it score you: applying triggers a hard inquiry that can dent your credit briefly, and closing the accounts you clear can shorten your average account age and move your utilization — both minor next to paying the new loan on time, and neither modeled here. One naming point, because the products blur: a debt consolidation loan and a personal loan are usually the same thing, the first describing what you do with the money, with the same fixed rate, term, and payment either way. Re-run the comparison at the APR you are actually offered; that number, not this estimate, decides it.

Three routes out of the same debt this tool does not price

A standalone fixed-rate consolidation loan is one way out, and the only one modeled here. This page does not model a balance transfer credit card, where a zero-percent window and a transfer fee rearrange the arithmetic completely. It does not model a home equity loan or HELOC, which can carry a lower rate precisely because your house is the collateral — a cheaper payment bought with a risk no column above can show you. And it does not model a debt management plan, where a nonprofit counseling agency negotiates with your creditors and you pay the agency one monthly amount. Each deserves its own comparison; the numbers here will not carry over.

The sharpest limitation left is behavioral rather than financial: the whole comparison assumes you stop using the accounts you consolidate. Charge those cards back up after the loan clears them and you are holding the loan and the new balances at once — the failure mode consolidation is best known for, and the one this page cannot catch.

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Read the guide

For the amortization formula behind any fixed-rate installment loan, worked through step by step, see How to Calculate Monthly Loan Payments Before Borrowing.

Sources

• What do I need to know about consolidating my credit card debt? — Consumer Financial Protection Bureau
• What is the difference between credit counseling and debt settlement, debt consolidation, or credit repair? — Consumer Financial Protection Bureau
• How To Get Out of Debt — Federal Trade Commission