Debt Consolidation Calculator

How to Use This Calculator

Step 1: Enter Your Current Debts

Add each of your current debts with their balance, interest rate, and minimum payment. You can find these figures on your monthly statements or by logging into each account online. Add as many debts as you have — use the "Add Another Debt" button to include more rows.

Step 2: Enter the Consolidation Loan Offer

Input the APR you've been quoted for a personal consolidation loan and the repayment term in months. A 60-month (5-year) term is common, but shorter terms mean less interest paid overall even if the monthly payment is higher.

Step 3: See Your Savings Instantly

The calculator compares the total interest you'd pay staying on your current debts at minimum payments versus rolling everything into the new loan. You'll see immediately whether consolidation saves you money and by exactly how much.

Understanding Debt Consolidation

How Debt Consolidation Works

Debt consolidation replaces multiple monthly payments with a single, fixed-rate loan. You take out one personal loan large enough to pay off all your existing debts, then make a single monthly payment to the new lender. The goal is twofold: a lower interest rate that reduces total costs, and one predictable payment that simplifies budgeting. Consolidation works best when your combined debts carry high variable rates, typically credit cards at 20% or more, and you can qualify for a personal loan at a significantly lower rate.

When Consolidation Makes Sense vs. Other Strategies

Consolidation is strongest when you have multiple high-rate debts and can lock in a meaningfully lower rate. If your debt is primarily on one or two credit cards, a balance transfer to a 0% promotional card may save even more, since you pay no interest during the promotional window. If your debts have varied rates and you are disciplined about extra payments, the debt avalanche method can achieve similar savings without the origination fee a consolidation loan charges. The right choice depends on your credit score, the number of debts you carry, and how much simplification you need.

Hidden Costs to Watch For

Consolidation loans often carry origination fees of 1% to 8% of the loan amount, which are deducted from your disbursement or added to the balance. A longer repayment term can also offset rate savings: stretching a $15,000 balance from 3 years to 5 years lowers your monthly payment but may increase total interest even at a lower rate. Always compare the total cost of the consolidation loan, including fees and full-term interest, against what you would pay on your current debts. This calculator does that comparison automatically.

Frequently Asked Questions

What is debt consolidation?

Debt consolidation means combining multiple debts — such as credit cards, personal loans, or medical bills — into a single new loan, ideally at a lower interest rate. The goal is to simplify repayment into one fixed monthly payment and reduce the total interest you pay over time.

What's a good interest rate for debt consolidation?

A good consolidation rate is one that is lower than your current weighted average APR across all your debts. Borrowers with good credit can typically qualify for personal loans in the 8–15% range, compared to the 20%+ rates that are common on credit cards. The lower the rate relative to your existing debts, the more you stand to save.

Does debt consolidation hurt your credit score?

In the short term, applying for a consolidation loan triggers a hard inquiry and adds a new account to your credit file, which can temporarily lower your score by a few points. Long term, consolidation often improves your credit profile by reducing your credit utilization ratio on revolving accounts and giving you a single on-time payment to manage each month.

What types of debt can be consolidated?

Most unsecured debts can be consolidated into a personal loan, including credit cards, personal loans, medical debt, and private student loans. Mortgages and auto loans are secured by collateral and typically require their own refinancing process rather than a general consolidation loan.

Is debt consolidation the same as a balance transfer?

No. A balance transfer moves credit card debt to a new card with a 0% promotional rate, while consolidation takes out a personal loan to pay off multiple debts. Balance transfers work best for credit card debt you can pay off within the promotional period (typically 12 to 21 months). Consolidation works for larger amounts, mixed debt types, and longer repayment terms. Use our balance transfer calculator to compare the two approaches side by side.

What credit score do I need for a debt consolidation loan?

Most lenders require a minimum credit score of 580 to 660 for a consolidation loan, though the best rates go to borrowers with scores above 700. If your score is below 580, you may still qualify through a credit union or an online lender that considers alternative factors. Keep in mind that the rate you receive directly determines whether consolidation saves you money, so compare offers from multiple lenders before committing.