Debt Consolidation Calculator
See whether rolling several debts into one consolidation loan lowers your monthly payment, shortens your payoff and cuts total interest. Itemize up to four debts or enter a single blended balance, add any origination fee, and compare both paths side by side, including the fee-adjusted real APR.
Formula
Worked example
An 18,000 balance at 11.5% APR over 36 months with no fee: r = 0.115/12 = 0.009583, so M = 593.57/month and total interest = 593.57 x 36 - 18,000 = 3,368. Add a 3% origination fee financed into the loan and the amount borrowed becomes 18,540, lifting the payment to about 611 and total interest plus fee to roughly 3,469.
What debt consolidation actually changes
Consolidation replaces several debts with a single loan, usually at a lower interest rate and a fixed repayment term. The headline benefit is one predictable payment instead of many, but the real financial test is total interest paid. This calculator amortizes your combined balance at the new rate to find the monthly payment, then compares the lifetime interest of that loan against the interest you would pay continuing on your current path. You can enter a single blended balance for a quick answer, or itemize up to four debts so the tool totals the balances and payments and works out a balance-weighted blended rate for you.
Origination fees and the real APR
Many consolidation and personal loans charge an origination fee or points, commonly 1% to 8% of the amount borrowed. That fee changes the math. If it is financed into the loan, the amount you actually borrow rises and you pay interest on the fee too. If you pay it upfront in cash, it is a sunk cost that still eats into your savings. The calculator handles both: toggle whether the fee is rolled in, and it reports the real APR, the fee-adjusted annual rate that captures the true cost of the loan. Compare that real APR, not just the headline rate, against your current blended rate.
Lower payment is not the same as lower cost
A consolidation loan can shrink your monthly payment simply by spreading the balance over a longer term, which feels like relief but can quietly increase the total interest you pay. The only fair comparison weighs the full interest and fee cost of both paths, plus how long each takes to clear. The calculator shows the payoff time on each side so you can see whether the new loan really gets you debt-free sooner. A shorter term at a lower real APR is the genuine win: it cuts the payment, the interest, and the time in debt at once.
When the numbers favor consolidating
Consolidation tends to pay off when your new real APR is meaningfully below your current blended rate, common when moving high-interest credit-card debt into a personal or secured loan. The wider that rate gap, the larger the interest savings. It works against you when the new rate is similar to your old one, when a large origination fee erases the benefit, or when you stretch the term so far that lower-rate-but-longer wipes out the gain. Run the comparison with the exact rate, term, and fee the lender quotes before committing.
Reading the comparison
| Result | What it means |
|---|---|
| New payment lower | Easier monthly cash flow, but verify total interest still falls |
| Real APR below current rate | The fee-adjusted loan genuinely costs less to borrow |
| Interest saved positive | Consolidation costs less over the full term, fees included |
| Interest saved negative | You pay more overall, usually from a longer term or a high fee |
| New payoff time shorter | You reach debt-free sooner, not just with a smaller payment |
| Payment never covers interest | Current debt grows; consolidation or higher payments are urgent |
How to interpret the difference between your current path and the consolidation loan.
Frequently asked questions
Does consolidating debt always save money?
No. It saves money only when the new loan’s total interest and fees over its term are lower than what you would otherwise pay. A lower monthly payment achieved by lengthening the term, or a large origination fee, can actually raise total cost, so always compare the total-interest and real-APR figures, not just the monthly payment.
What is the real APR and why does it matter?
The real APR is the fee-adjusted annual rate. It folds any origination fee or points into the cost so you see what the loan truly costs to borrow, expressed as a single rate. A loan with a low headline rate but a steep fee can have a real APR well above a fee-free loan, so the real APR is the fairest number to compare against your current debts.
Should I roll the origination fee into the loan or pay it upfront?
Paying it upfront in cash avoids paying interest on the fee, so it usually costs slightly less overall, but it requires cash on hand. Financing the fee spreads it across the term at the loan’s rate. The calculator lets you toggle between the two so you can see the difference in payment and total cost for your situation.
How is the new monthly payment calculated?
It uses the standard amortized-loan formula on the amount financed at the new APR and term. If the fee is rolled in, the amount financed is your balance plus the fee. Each payment covers that month’s interest plus a slice of principal, and the fixed payment fully clears the balance by the end of the term.