Is a debt consolidation loan cheaper?
Enter your debts and the loan you are offered to see whether a debt consolidation loan lowers your payment, and whether it saves or costs money in the end.
- Money saved by consolidating
- $4,415.94
A 48-month consolidation loan at 11% costs $476.10 a month and $22,852.88 in all, against $27,268.82 for your current debts.
Saves money
- Costs more
- Saves money
- Loan payment
- $476.10
- Current monthly payments
- $555.00
- Monthly payment change
- $78.90
- Debts paid off
- $17,500.00
- Loan amount
- $18,421.05
- Origination fee
- $921.05
- Loan APR
- 13.76%
- Loan interest
- $4,431.83
- Total paid on the loan
- $22,852.88
- Interest on current debts
- $9,768.82
- Total paid on current debts
- $27,268.82
- Months to pay off current debts
- 58
- Months
- 58
Answer for the example date Wednesday, September 30, 2026. It changes to today's date when the page loads.
Money saved by consolidating: $4,415.94. A 48-month consolidation loan at 11% costs $476.10 a month and $22,852.88 in all, against $27,268.82 for your current debts.
Which pays off the debt faster?
What would you pay each month?
The results are estimates for information only. They are not financial, tax, or legal advice. Check the numbers with your lender or a qualified professional before you decide. Terms of use
How to calculate
Compares paying your debts as you do now with one debt consolidation loan: the monthly payment, the total interest and fees, the APR, and the money saved or lost.
Example with the default inputs (Your debts [Name Card A, Balance $8,000.00, APR 24.99%, Monthly payment $240.00; Name Card B, Balance $4,500.00, APR 21.99%, Monthly payment $135.00; Name Personal loan, Balance $5,000.00, APR 17.5%, Monthly payment $180.00], Consolidation loan rate 11%, Loan term (months) 48, Origination fee 5%, Start date September 30, 2026) on the example date Wednesday, September 30, 2026: A 48-month consolidation loan at 11% costs $476.10 a month and $22,852.88 in all, against $27,268.82 for your current debts.
Method: Current: each debt pays its own payment monthly, interest = balance × APR ÷ 1200, until it is gone. Loan: L = owed ÷ (1 − fee), payment = L × r ÷ (1 − (1 + r)^−n); saving = current total paid − n × payment.
- Your current debts keep their rates and monthly payments, with no new charges, and each is paid until it is gone; nothing rolls over.
- The origination fee is taken out of the new loan, so the loan is made larger to pay off every debt in full.
- The new loan has a fixed rate and equal monthly payments made at the end of each month.
- Values are not rounded to the cent between months; only the display is rounded.
Worked examples
Each example is checked against the calculator on every build.
- Your debts Card A 8000 24.99 240; Card B 4500 21.99 135; Personal loan 5000 17.5 180, Consolidation loan rate 11%, Loan term (months) 48, Origination fee 5% gives Debts paid off $17,500.00, Loan amount $18,421.05, Loan payment $476.10, Loan APR 13.759152%, Total paid on the loan $22,852.88, Months to pay off current debts 58, Total paid on current debts $27,268.82, Money saved by consolidating $4,415.94, Monthly payment change $78.90.Source: Consumer Financial Protection Bureau, What do I need to know about consolidating my credit card debt? https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-about-consolidating-my-credit-card-debt-en-1861/
- Your debts A 1200 0 100; B 2400 0 100, Consolidation loan rate 0%, Loan term (months) 24, Origination fee 0% gives Loan payment $150.00, Months to pay off current debts 24, Money saved by consolidating $0.00, Monthly payment change $50.00, Loan APR 0%.Source: Consumer Financial Protection Bureau, What do I need to know about consolidating my credit card debt? https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-about-consolidating-my-credit-card-debt-en-1861/
- Your debts Card 10000 18 300, Consolidation loan rate 16%, Loan term (months) 60, Origination fee 8% gives Loan amount $10,869.57, Loan payment $264.33, Loan APR 19.88992%, Total paid on current debts $13,967.21, Money saved by consolidating -$1,892.39.Source: Consumer Financial Protection Bureau, What do I need to know about consolidating my credit card debt? https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-about-consolidating-my-credit-card-debt-en-1861/
How it works
Your current debts. Each debt has a balance, an APR, and a monthly payment. Each month, for every debt not yet paid off, interest = balance × APR ÷ 1200 is added, then the debt is paid its monthly payment, or its whole balance when that is smaller. Nothing rolls over from a paid-off debt. The plan runs until every balance is 0.
- There is no answer when a debt's payment is not more than its first month's interest (it would never be paid off), or when the plan runs past 600 months.
- Current totals: the months until the last debt is paid off; interest = the sum of every month's interest; total paid = the balances plus that interest; current monthly payments = the sum of the payments.
The consolidation loan. Write owed for the balances added up, f for the origination fee as a decimal (0 when empty), r for the monthly rate (the yearly rate in percent ÷ 1200), and n for the months.
- Loan amount: L = owed ÷ (1 − f), so that after the fee L × f comes out, the cash pays off every debt. The fee is L − owed.
- Payment: payment = L × r ÷ (1 − (1 + r)^−n); at 0%, L ÷ n. Each month interest = balance × r; the last payment pays what is left.
- Totals: total paid on the loan = n × payment; loan interest = n × payment − L.
- APR: the monthly rate j at which the n payments, discounted at j, add up to the owed amount (the cash that pays off the debts): owed = payment × (1 − (1 + j)^−n) ÷ j. The APR is 12 × j. With no fee it equals the rate.
The comparison. Money saved = total paid on the current debts − total paid on the loan (negative when the loan costs more). Monthly payment change = current monthly payments − the loan payment.
Assumptions
- The current debts keep their rates and payments, and nothing new is charged to them.
- The origination fee is taken out of the loan; other fees and prepayment penalties are not included.
- The new loan has a fixed rate and equal monthly payments at the end of each month.
- Values are not rounded to the cent between months; only the display is rounded.
- The default rate and fee are examples, not live offers.
Worked examples by hand
Two interest-free debts into a 24-month loan at 0% with no fee. A owes $1,200 and B $2,400, each paying $100: A is paid off in 12 months and B in 24, so the current plan takes 24 months and pays $3,600. The loan is $3,600 and its payment is 3,600 ÷ 24 = $150, $50 less than the $200 paid now; its total is also $3,600, so the money saved is $0. The APR is 0%.
Three debts into a 48-month loan at 11% with a 5% fee (card A $8,000 at 24.99% paying $240; card B $4,500 at 21.99% paying $135; a personal loan $5,000 at 17.5% paying $180). The debts add up to $17,500, so the loan is 17,500 ÷ 0.95 = $18,421.05. r = 0.11 ÷ 12, and the payment is 18,421.05 × 0.0091667 ÷ (1 − 1.0091667^−48) = $476.10, $78.90 less than the $555 paid now. The loan costs 48 × 476.102 = $22,852.88 in all. Month by month, the current debts take 58 months and $27,268.82, so consolidating saves $4,415.94. The monthly rate at which 48 payments of $476.10 are worth $17,500 is 1.146596%, so the APR is 13.76%.
One card into a 60-month loan at 16% with an 8% fee. The $10,000 card at 18% paying $300 a month is gone in 47 months after $13,967.21. The loan is 10,000 ÷ 0.92 = $10,869.57 and its payment is $264.33, but 60 payments total $15,859.60, so consolidating costs $1,892.39 more. The APR with the fee is 19.89%.
Other questions people ask
How does this calculator decide if consolidation saves money?
It adds up everything you would pay if you keep paying each debt as you do now, and everything you would pay on the new loan. The difference is the money saved; when it is negative, consolidating costs more even if the monthly payment is lower.
Why is the loan bigger than my debts?
Most consolidation loans take an origination fee out of the money they pay out. To pay off $17,500 of debts with a 5% fee, you must borrow $17,500 ÷ 0.95 = $18,421.05. The page sizes the loan that way.
Why can a lower payment cost more?
A longer term or a fee can outweigh a lower rate. Moving a $10,000 card at 18% paying $300 a month into a 60-month loan at 16% with an 8% fee lowers the payment by $35.67 but costs $1,892.39 more in total.
What is the APR of the consolidation loan?
The yearly rate at which the loan payments repay the cash you actually get, the debts paid off. It counts the fee, so it is higher than the loan rate whenever there is a fee: 13.76% for the 11% loan with a 5% fee in the example.
What does the page assume about my current debts?
That you keep paying each one its current monthly payment, with no new charges, until it is gone, and that the rates do not change. It does not roll a paid-off debt’s payment into the others; see the debt payoff calculator for that.
Is consolidation a good idea if I keep using my cards?
Only if the cards stay paid off. New charges on the cleared cards add new debt on top of the loan, which this comparison does not include.