See if a consolidation loan actually beats your current debts
๐ก Why This Matters Debt consolidation offers can sound appealing, but whether one actually saves you money depends on the real numbers โ your current blended rate, the offer's rate, and the term. This tool runs the honest comparison side by side.
Your Current Debts
Consolidation Loan Offer
Consolidation can help even at a similar interest rate, because it locks your full payment into one steady balance โ with separate cards, paying one off doesn't automatically redirect that freed-up money to the others unless you do it yourself.
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Your current situation is modeled by paying only the minimum on each debt until every balance reaches zero, with interest accruing monthly on each remaining balance. The consolidation option is modeled as a single fixed-payment loan for your total balance, at the offered APR and term, using standard amortization. Both scenarios are run to completion so you can see real totals, not estimates.
The comparison shows total interest paid under each path and the resulting new monthly payment. Consolidation can win even at a similar interest rate to your current blended rate โ because with separate minimum payments, paying off one card doesn't free up that money for the others automatically, while a consolidation loan keeps your full payment working the whole term.
This calculator doesn't include origination fees, balance transfer fees, or closing costs some consolidation loans charge โ factor those in separately, since they can offset some of the savings shown here. It also assumes you don't accumulate new debt on the accounts you consolidate, which is a common way consolidation backfires in practice.
If the numbers favor consolidation, compare a few real loan offers rather than just the first one, since the APR and fees vary meaningfully between lenders. If consolidation doesn't clearly help, the Debt Payoff Calculator's Avalanche method can capture a similar benefit without taking on a new loan.
Example: Say you have three cards totaling $12,000 โ a $5,000 balance at 24% APR, a $3,000 balance at 22% APR, and a $4,000 balance at 26% APR, with combined minimum payments of $325/month. Paying only minimums, it takes 82 months and costs $10,795.83 in interest. A consolidation loan at 12% APR over 5 years costs just $4,016 in interest and finishes in 60 months โ a savings of nearly $6,780.
No โ even at a similar rate, consolidation can help because it locks your full payment into paying down debt for the whole term. With separate minimum payments, once one card is paid off, that freed-up money doesn't automatically go toward the others unless you redirect it yourself.
If the consolidation loan's APR is meaningfully higher than your current blended rate, or if it comes with high origination fees, it can end up costing more overall. It's also not a fix on its own if the underlying spending habits that created the debt haven't changed.
It's the weighted average interest rate across all your current debts, based on how much you owe on each. This calculator computes it automatically so you can compare it directly against any consolidation loan offer.