Free Calculator

Debt Consolidation Calculator

Combine multiple debts into one loan and see if you can save money and simplify payments. Compare current payments against a consolidation loan.

Your Debts & New Loan

Enter your current debts and proposed consolidation loan terms

Current Debts

Balance ($)

Rate (%)

Payment/mo

Balance ($)

Rate (%)

Payment/mo

Consolidation Loan

New Rate (%)

New Term (months)

Consolidation Results

See if combining your debts makes sense

Add your debts to see how much you could save by consolidating

Quick Answers

Avg. credit card rate

20-25% APR

Personal loan rate

8-20% APR

Break-even typical

12 to 24 months

Consolidation terms

24 to 84 months

Frequently asked questions

Common questions about debt consolidation.

What is debt consolidation?

Debt consolidation combines multiple debts -- credit cards, personal loans, medical bills -- into a single new loan, ideally at a lower interest rate. The goal is to simplify your monthly payments down to one and reduce the total interest you pay over time. Instead of tracking five different due dates, rates, and minimum payments, you manage a single account. Consolidation does not erase debt; it restructures it. The strategy works best when the new loan carries a meaningfully lower rate than your weighted average current rate.

When does debt consolidation make sense?

Consolidation makes sense when three conditions are met: you can qualify for a lower interest rate than your current debts average, you have multiple payments that are difficult or stressful to track, and you are disciplined enough not to run up new balances on the accounts you pay off. If you consolidate $20,000 in credit card debt at 22% into a personal loan at 11%, you cut your interest cost roughly in half. But if you then charge those cards back up, you end up with both the consolidation loan and new card balances -- worse than before.

Does debt consolidation hurt your credit score?

In the short term, applying for a new consolidation loan causes a hard credit inquiry, which typically drops your score by a few points temporarily. Long term, consolidation can improve your score in two significant ways: it lowers your credit utilization ratio by paying off revolving balances, and it reduces the risk of missed payments that come from juggling multiple accounts. Most borrowers who maintain on-time payments on the consolidation loan see their scores recover and improve within 6 to 12 months.

What is the difference between debt consolidation and debt settlement?

Debt consolidation combines your debts into a new loan that you repay in full -- your credit history reflects all payments made, and creditors are paid completely. Debt settlement involves negotiating with creditors to accept less than the full amount owed, usually after you have stopped making payments to build leverage. Settlement severely damages your credit score, can result in taxable income on the forgiven amount, and stays on your credit report for seven years. For most borrowers, consolidation is the appropriate tool; settlement is a last resort before bankruptcy.

Can I consolidate student loans and credit cards together?

Federal student loans cannot be included in a private consolidation loan. Doing so means permanently losing federal protections including income-driven repayment plans, Public Service Loan Forgiveness eligibility, and deferment or forbearance options during hardship. Private student loans can sometimes be consolidated with other debts through a private lender. If you have federal student loans, consolidate them separately through the federal Direct Consolidation Loan program to preserve those protections, then handle private debts and credit cards through a separate personal loan.

About this calculator

This debt consolidation calculator compares the combined cost of your existing debts against a single consolidation loan to show potential monthly savings and total interest reduction. It uses the standard amortization formula for each loan and does not model balance transfer fees, origination fees, or variable rate adjustments on existing debts.

Debt and credit benchmarks referenced on this page follow guidelines published by the Consumer Financial Protection Bureau (CFPB). Debt-to-income ratio thresholds reference standard mortgage underwriting guidelines from Fannie Mae and Freddie Mac.

MyLoanCalcs.com provides free educational calculators and does not offer financial advice or lending services. Debt consolidation decisions involve credit, tax, and legal considerations -- consult a licensed financial advisor before consolidating.

Before You Calculate

Understanding Your Debt Consolidation Calculator Results

Debt consolidation can be a powerful tool for reducing interest costs and simplifying repayment -- or it can extend your debt timeline and increase your total cost if the new loan rate and term are not structurally better than what you currently have. The calculator shows you the comparison in concrete numbers.

This guide explains how to use the calculator accurately, what the results mean, and what questions to answer before deciding whether consolidation is the right move for your situation.

How to Read Your Debt Consolidation Calculator Results

Follow these six steps for an accurate and complete analysis.

List every debt you plan to consolidate accurately

The calculator's value depends entirely on accurate inputs. For each debt you are considering consolidating, you need three numbers: the current outstanding balance, the current interest rate (APR), and the minimum monthly payment. Log into each account or pull your most recent statements. Do not use the original loan amount or the credit limit -- use the actual payoff balance. A single inaccurate balance changes both the monthly payment comparison and the total interest projection.

Pro tip: Pull your free credit report at annualcreditreport.com to see all outstanding balances and creditors in one place.

Compare the consolidation loan rate against your weighted average rate

The fundamental test for consolidation is whether the new loan rate is meaningfully lower than the weighted average rate of your existing debts. If you have $15,000 in credit card debt at 22% and $5,000 in medical debt at 0%, your weighted average rate is about 16.5%. A consolidation loan at 12% saves money. A loan at 18% does not. The calculator shows you the total interest paid under both scenarios -- that comparison drives the decision.

Pro tip: Weight each debt by its balance share: multiply each balance by its rate, sum those products, then divide by total debt.

Understand the difference between monthly payment savings and total cost savings

Consolidation often lowers your monthly payment by extending the repayment term -- but a lower payment over more years can cost more in total interest than your current debts combined. The calculator shows both monthly payment comparison and total interest comparison. A consolidation that reduces your monthly payment by $200 but increases total interest paid by $4,000 is not a financial win. Look at both numbers before deciding.

Pro tip: The best consolidation reduces both your monthly payment AND total interest. If it only reduces the payment, you are trading short-term relief for long-term cost.

Account for origination fees in the true cost

Personal loans used for debt consolidation often carry origination fees of 1% to 8% of the loan amount. A $20,000 consolidation loan with a 5% origination fee means $1,000 in upfront cost, reducing funds received or increasing the balance. Add this fee to the total interest figure to get the true cost comparison. Balance transfer credit cards are another consolidation vehicle -- they often have 0% promotional periods but charge 3-5% transfer fees.

Pro tip: Always ask lenders for the APR on a consolidation loan, not just the interest rate. APR includes origination fees and is the correct comparison number.

Address the spending behavior that created the debt

Consolidation moves debt -- it does not eliminate it. The most common consolidation failure is paying off credit cards with a consolidation loan and then running the card balances back up. If the spending pattern that created the original debt is not addressed, consolidation leaves you in a worse position: the original debt plus new card balances. Before consolidating, close or freeze the accounts being paid off, or at minimum commit to a specific plan for not re-accumulating balances.

Pro tip: Put a freeze on consolidated accounts or reduce credit limits after payoff. Out of sight and restricted access reduces the risk of re-accumulation.

Evaluate secured vs. unsecured consolidation options

Unsecured personal loans require no collateral and carry higher rates. Secured options -- a home equity loan or HELOC -- typically offer lower rates because your home backs the loan. The rate difference can be significant: a personal loan at 12% vs. a home equity loan at 8% on $30,000 over 5 years saves roughly $3,600 in interest. However, a secured loan puts your home at risk if you cannot repay. Only use home equity for consolidation if you are confident in your repayment ability.

Pro tip: Use the HELOC Calculator to compare home equity consolidation costs against a personal loan rate.

3 Common Mistakes in Debt Consolidation

What to Do Next

These tools and guides will help you model consolidation options, understand the key terms, and evaluate whether consolidation fits your overall debt payoff strategy.

Personal Loan Calculator

Model a consolidation loan payment.

HELOC Calculator

Compare home equity consolidation costs.

What Is APR?

The true annual cost including fees.

How to Get Out of Debt

Payoff strategies beyond consolidation.

Loan Comparison Calculator

Compare two loan offers side by side.

What Is Amortization?

How payments split between principal and interest.

Methodology

How It Works

Enter the balances, interest rates, and current monthly payments for each of your outstanding debts. The calculator then compares your current total monthly outlay and lifetime interest against a single consolidation loan.

Key comparison metrics:

Monthly Savings = Current Total Payments - New Consolidation Payment

Interest Savings = Current Total Interest - New Total Interest

Even if a consolidation loan offers a lower monthly payment, extending the loan term too long can result in paying more total interest over time. This tool shows both the short-term cash flow relief and the long-term total interest cost.

About the Author: De Van Do

De Van Do is the author and site builder behind MyLoanCalcs.com. With a background in technology, De Van Do built this site out of an interest in making financial calculations clear and accessible. De Van Do is not a licensed loan officer, mortgage broker, or financial advisor -- content on this site is for informational purposes only.