Debt Consolidation Calculator
Swap three debts totaling $18,500.00 for a 48-month loan at 11.99% with a 5% fee. Your monthly payment drops by $88.56 and you save $2,826.84.
Last reviewed
What consolidating your debts does
Total Saved
$2,826.84
New Payment
$511.44
Payment Change
-$88.56
Loan APR (With Fee)
14.63%
This 48-month loan at 11.99% clears $18,500.00 across 3 debts (20.52% weighted APR) and saves $2,826.84.
Your payment drops by $88.56, from $600.00 to $511.44 a month, and total cost is $6,049.09.
The 5.00% fee ($925.00) puts the loan at $19,425.00 and 14.63% APR; rates under 17.97% save money.
Keep paying $600.00 a month on the new loan and you finish in 40 months, saving $3,791.09.
Your current debts and loan offer
- current: $18,500.00 (20.52% APR), paid = $27,375.94
- L = $18,500.00 + $925.00 (5.00% fee) = $19,425.00
- r = 11.99% ÷ 12 ≈ 0.009992; M = $19,425.00 × r × (1 + r)48 ÷ ((1 + r)48 − 1) = $511.44
- new total = 48 × $511.44 = $24,549.09 (14.63% APR)
- saved = $27,375.94 − $24,549.09 = $2,826.84
Remaining balance at the end of each year
Cumulative interest and fee by year
Your current debts at today's payments
| Debt | Balance | APR | Payment | Months to pay off | Total interest |
|---|---|---|---|---|---|
| Debt 1 | $8,000.00 | 22.99% | $250.00 | 51 | $4,508.60 |
| Debt 2 | $4,500.00 | 27.49% | $150.00 | 52 | $3,198.10 |
| Debt 3 | $6,000.00 | 12.00% | $200.00 | 36 | $1,169.24 |
Kept as they are, your 3 debts cost $600.00 a month at a 20.52% weighted APR, take 52 months (Debt 2 finishes last), and cost $8,875.94 in interest (Debt 1 accounts for $4,508.60).
Ways to handle these debts
| Option | Monthly payment | Payoff months | Effective APR | Interest and fee | Total saved |
|---|---|---|---|---|---|
| Keep current debts at today's payments | $600.00 | 52 | 20.52% | $8,875.94 | $0.00 |
| Consolidation loan (fee added to loan) | $511.44 | 48 | 14.63% | $6,049.09 | $2,826.84 |
| Consolidation loan (fee deducted, grossed up) | $512.72 | 48 | 14.77% | $6,110.62 | $2,765.32 |
| Consolidation loan with no origination fee | $487.09 | 48 | 11.99% | $4,880.09 | $3,995.85 |
| Consolidate and keep paying current monthly budget | $600.00 | 40 | 15.15% | $5,084.85 | $3,791.09 |
Adding the 5.00% fee to the loan borrows $19,425.00 (14.63% APR); if the lender deducts the fee from the proceeds instead, you must borrow $19,473.68 (14.77% APR, $61.53 more over the term) to clear all $18,500.00 of debt.
Year-by-year remaining balance and cost
| Year | Current debts balance | Consolidation loan balance | Current debts interest to date | New loan interest and fee to date | Cost saved to date |
|---|---|---|---|---|---|
| 1 | $14,793.59 | $15,400.38 | $3,493.59 | $3,037.65 | $455.94 |
| 2 | $10,332.01 | $10,865.78 | $6,232.01 | $4,640.33 | $1,591.68 |
| 3 | $4,970.62 | $5,756.59 | $8,039.86 | $5,668.41 | $2,371.45 |
| 4 | $968.19 | $0.00 | $8,837.43 | $6,049.09 | $2,788.34 |
| 5 | $0.00 | $0.00 | $8,875.94 | $6,049.09 | $2,826.84 |
End of year 1 balance is $14,793.59 on your current debts versus $15,400.38 on the consolidation loan; by year 5, cumulative interest and fees reach $8,875.94 versus $6,049.09.
What the loan saves at each interest rate
Across rates from 6% to 22.99%, the consolidation loan saves $5,478.49 at 6% ($456.20 a month) and costs $2,503.75 more at 22.99% ($622.49 a month).
| Loan rate | Monthly payment | Payment change | Effective APR | Interest and fee | Total saved |
|---|---|---|---|---|---|
| 6% | $456.20 | -$143.80 | 8.52% | $3,397.44 | $5,478.49 |
| 8% | $474.22 | -$125.78 | 10.56% | $4,262.61 | $4,613.33 |
| 10% | $492.67 | -$107.33 | 12.60% | $5,148.07 | $3,727.86 |
| 11.99% (closest to your input) | $511.44 | -$88.56 | 14.63% | $6,049.09 | $2,826.84 |
| 14% | $530.82 | -$69.18 | 16.69% | $6,979.21 | $1,896.73 |
| 16% | $550.51 | -$49.49 | 18.73% | $7,924.48 | $951.46 |
| 18% | $570.61 | -$29.39 | 20.77% | $8,889.25 | -$13.31 |
| 20% | $591.11 | -$8.89 | 22.82% | $9,873.27 | -$997.33 |
| 22.99% | $622.49 | $22.49 | 25.88% | $11,379.68 | -$2,503.75 |
Total saved by consolidating, by loan rate (rows) and loan term in months (columns).
| Consolidation Loan Interest Rate by consolidation loan term | 24 months | 36 months | 48 months | 60 months | 72 months | 84 months |
|---|---|---|---|---|---|---|
| 6% | $6,713.67 | $6,101.87 | $5,478.49 | $4,843.56 | $4,197.09 | $3,539.16 |
| 8% | $6,290.97 | $5,462.41 | $4,613.33 | $3,743.80 | $2,853.94 | $1,943.91 |
| 10% | $5,863.17 | $4,811.49 | $3,727.86 | $2,612.50 | $1,465.70 | $287.78 |
| 11.99% (closest to your input) | $5,432.46 | $4,152.51 | $2,826.84 | $1,455.92 | $40.31 | -$1,419.30 |
| 14% | $4,992.33 | $3,475.52 | $1,896.73 | $256.79 | -$1,443.25 | -$3,202.14 |
| 16% | $4,549.33 | $2,790.62 | $951.46 | -$966.76 | -$2,962.27 | -$5,032.99 |
| 18% | $4,101.32 | $2,094.57 | -$13.31 | -$2,220.10 | -$4,523.04 | -$6,918.87 |
| 20% | $3,648.31 | $1,387.44 | -$997.33 | -$3,502.69 | -$6,124.49 | -$8,857.92 |
| 22.99% | $2,961.81 | $309.87 | -$2,503.75 | -$5,473.36 | -$8,592.01 | -$11,851.67 |
What the loan saves at each repayment term
Shortening the loan to 12 months saves $6,666.37 ($1,725.80 a month, 21.36% APR), while stretching it to 96 months costs $2,922.12 more ($315.60 a month, 13.45% APR).
| Loan term | Monthly payment | Payment change | Effective APR | Interest and fee | Total saved |
|---|---|---|---|---|---|
| 12 months | $1,725.80 | $1,125.80 | 21.36% | $2,209.56 | $6,666.37 |
| 24 months | $914.31 | $314.31 | 16.96% | $3,443.48 | $5,432.46 |
| 36 months | $645.10 | $45.10 | 15.42% | $4,723.43 | $4,152.51 |
| 48 months (closest to your input) | $511.44 | -$88.56 | 14.63% | $6,049.09 | $2,826.84 |
| 60 months | $432.00 | -$168.00 | 14.16% | $7,420.01 | $1,455.92 |
| 72 months | $379.66 | -$220.34 | 13.84% | $8,835.63 | $40.31 |
| 84 months | $342.80 | -$257.20 | 13.62% | $10,295.24 | -$1,419.30 |
| 96 months | $315.60 | -$284.40 | 13.45% | $11,798.05 | -$2,922.12 |
How a debt consolidation loan works
Debt consolidation replaces several separate balances with one new loan. The CFPB's guide on consolidating credit card debt lists three ways to consolidate: a card balance transfer, a debt consolidation loan, and a home equity loan. As the CFPB's answer on personal installment loans says, "Personal installment loans are closed-end loans, meaning that the lender gives you all of the money at the beginning." You use that cash to clear the old accounts. Then you make one fixed payment each month.
A lower monthly payment does not mean a loan saves money. The CFPB's guide on consolidating credit card debt warns that "Although your monthly payment might be lower, it may be because you’re paying over a longer time." Stretching the default loan from 48 months to 84 months drops the payment to $342.80 a month, yet you pay $1,419.30 more than keeping your cards.
To compare both paths fairly, this page runs two schedules side by side. First, it keeps each debt at the monthly payment you make today until its balance hits $0. It also finds the balance-weighted average APR of your debts (20.52% here). Second, it adds any fee to the total debt and finds the level payment over the new term. Total saved is what your current debts would cost minus what the new loan costs.
How origination fees change the true APR and loan size
A personal loan can carry an upfront fee of 1% to 8% of the amount borrowed. The CFPB's answer on interest rates and APRs notes that "The APR is the interest rate plus any additional fees charged by the lender." Under Regulation Z (12 CFR 1026.4(b)(3)), loan fees count as part of the finance charge. Under 12 CFR 1026.18(b), the amount financed is the net credit provided to clear your debts ($18,500.00 here).
In the default case, adding a 5% fee ($925.00) raises the note to $19,425.00. Under 12 CFR 1026.22 and Appendix J, 48 payments of $511.44 repay the amount financed at 1.21947% a month. Twelve times that rate is an APR of 14.63%, which sits 2.64 percentage points above the 11.99% interest rate. With a 0% fee, the payment drops to $487.09 and your savings rise to $3,995.85.
Some lenders take the fee out of the cash they send instead of adding it to the loan. Regulation Z's commentary says "The same rules apply when the creditor does not increase the face amount of the note by the amount of the charge but collects the charge by withholding it from the amount advanced to the consumer" (comment 18(b)(3)-1). If a lender takes 5% out of $18,500.00, only $17,575.00 reaches your cards. To clear all of your debts, you must borrow $18,500.00 ÷ (1 − 0.05) = $19,473.68. That puts the fee at $973.68, the payment at $512.72, the APR at 14.77%, and the savings at $2,765.32. Model one offer in detail on the personal loan calculator or check a disclosure on the APR calculator.
Comparing your weighted APR against market rates
Your weighted APR shows the blended rate your debts cost today. Multiply each balance by its APR, add those up, and divide by the total debt (20.52% on the default debts). In the Federal Reserve's G.19 release for August 2026, commercial banks charged 22.36% on cards assessed interest. Across all card accounts the average was 21.19%, against 11.90% on 24-month personal loans.
Because the fee adds to the loan and the term changes how long interest runs, the break-even rate sits below your weighted APR. On the default debts over 48 months with a 5% fee, the break-even rate is 17.97%. Any loan rate below 17.97% saves money. At 18% the loan loses $13.31, even though 18% is 2.52 points below the weighted APR.
Video walkthrough
A 3½-minute walkthrough of what a consolidation loan saves, what its fee does to the APR, and what a longer term costs.
Read the transcript
Does a consolidation loan save money?
0:00 Your debts, $18,500 in all, become one loan at about 12% over 48 months, with a 5% fee.
0:09 One payment a month replaces them all, and the loan saves you about $2,800 in total.
0:16 Your payment drops by about $90 a month, to about $510.
0:21 That is money left in your own budget every month.
0:24 It adds up over the life of the loan.
0:27 Your current debts cost about 21% a year, weighted by what each owes.
0:31 That is why one cheaper loan can save money, even with a fee on top.
What the origination fee does to the loan
0:37 Every single loan offer comes with a price.
0:40 Here the origination fee is $925, and it goes straight onto the loan you sign for.
0:47 The fee actually goes on top of the whole debt you clear, so the interest runs on $19,425 from the very first monthly payment that you make.
0:58 The CFPB says: "The APR is the interest rate plus any additional fees charged by the lender."
1:05 That is why the APR on the loan, about 15%, sits above the interest rate you sign for.
When the loan gets ahead of your debts
1:13 Here is what you owe each year: your combined outstanding debts.
1:16 And the loan starts higher, because the fee is inside it.
1:21 In year 4 the loan's balance passes below what your debts owe, and it reaches zero first.
1:27 The other half is the total you pay.
1:29 Your debts cost about $9,000 in interest.
1:33 The loan costs about $6,000 in interest and fee, and the difference is about $2,800.
What a longer term does to the total
1:40 Stretch the same loan over 84 months and the payment falls to about $340.
1:47 But you pay about $1,400 more in total.
1:50 The debt stays open longer, so the interest keeps running.
1:54 The other way round, a shorter term costs more a month and saves more overall.
2:00 At 36 months you would save about $4,200, if your budget can handle it.
2:05 The CFPB warns that a lower monthly payment may be because you are paying over a longer time.
Try your own numbers
2:13 To try your own numbers, enter the rate a lender offers and the term they quote.
2:18 Here that is 9.5% over 36 months.
2:22 The result follows right as you type.
2:24 Put in your own balances, your own APRs and what you pay each month now.
2:29 On this offer, the same comparison saves about $5,000.
Before you sign
2:34 Compare the rate, not the payment.
2:37 At 16% the loan saves about $950.
2:41 At 20% it costs about $1,000 more, and the payment barely moves from what you pay now.
2:48 If the new payment is smaller, send the difference to the loan instead of spending it.
2:53 Keep paying $600 a month and it clears in 40 months.
2:57 That saves about $3,800.
3:00 The CFPB cautions that a consolidation loan probably won’t help you get out of debt unless you spend less or earn more.
3:08 The old cards must stay at zero, or the debts come back and you pay twice.
3:14 So: compare the rate, not the payment, and remember that the fee raises the APR.
3:19 Check your own debts at fastcalc.us.
Debt consolidation formulas
each current debt i: r_i = APR_i ÷ 12 ÷ 100
n_i = −ln(1 − B_i × r_i ÷ P_i) ÷ ln(1 + r_i) (n_i = B_i ÷ P_i when r_i = 0)
k_i = ⌈n_i⌉ payments; paid_i = (k_i − 1) × P_i + PV(P_i, r_i, n_i − k_i + 1) × (1 + r_i)
weighted APR = (Σ B_i × APR_i) ÷ Σ B_i
new loan (fee added): L = (Σ B_i) × (1 + fee ÷ 100), r = newRate ÷ 12 ÷ 100
M = L × r × (1 + r)^N ÷ ((1 + r)^N − 1) (M = L ÷ N when r = 0)
new loan (fee deducted gross-up): L_gross = (Σ B_i) ÷ (1 − fee ÷ 100)
effective APR (12 CFR 1026.22): 12 × i where Σ_{k=1..N} M ÷ (1 + i)^k = Σ B_i
total saved = Σ paid_i − M × N; break-even rate r_be solves M(L, r_be, N) × N = Σ paid_iWorked debt consolidation examples
Three cards over 48 months (default case). You owe $8,000 at 22.99% ($250/mo, 51 months, $4,508.60 interest), $4,500 at 27.49% ($150/mo, 52 months, $3,198.10 interest), and $6,000 at 12% ($200/mo, 36 months, $1,169.24 interest). Kept as they are, the debts take 52 months and add $8,875.94 in interest ($27,375.94 total paid). The 48-month loan at 11.99% with a 5% fee costs $511.44 a month ($24,549.09 total paid, including $5,124.09 of loan interest), and you save $2,826.84.
Same debts stretched to 84 months. Taking the 11.99% loan with a 5% fee over 84 months drops the payment to $342.80 a month ($257.20 less than your current outlay). Its APR is 13.62%. Because interest runs for 7 years, interest and fee climb to $10,295.24 ($28,795.24 total paid), costing $1,419.30 more than keeping your cards.
Two cards over 36 months. You carry $5,000 at 18% and $3,000 at 24% with a combined $350.00 monthly payment (20.25% weighted APR, 32 months, $2,183.58 interest). A 36-month loan at 10% with a 3% fee ($240.00) borrows $8,240.00 at a 12.04% APR. The payment falls by $84.12 to $265.88 a month, interest and fee are $1,571.74, and you save $611.84.
What happens if you keep paying your old monthly budget
When a new loan lowers your monthly bill, you can keep the extra cash or send your old budget toward the loan. Under the CARD Act rules in 12 CFR 1026.7(b)(12) and Appendix M1, card statements must show what a 36-month payoff payment does compared with the minimum. Paying extra works the same way on a consolidation loan.
On the default debts, you pay $600.00 a month now. If you take the 48-month loan and keep paying $600.00 a month ($88.56 above the scheduled payment), you clear the loan in 40 months instead of 48. Total interest and fee drop from $6,049.09 to $5,084.85, and your savings jump to $3,791.09, finishing 12 months sooner than on your cards. Test custom extra payments on the loan extra payment calculator.
Risks to watch before you consolidate
A consolidation loan only cuts your debt if the paid-off cards stay at $0. When debt comes from overspending, the CFPB's guide on consolidating credit card debt cautions that "a debt consolidation loan probably won’t help you get out of debt unless you reduce your spending or increase your income." Running the cards back up leaves you paying the new loan plus new card bills.
Watch out for loans backed by your house and for short teaser rates. A home equity loan turns card balances into debt tied to your home. As the CFPB's guide on consolidating credit card debt warns, "If you don’t pay back the loan, you could lose your home in foreclosure." Promotional card rates also end after a set number of months, and paying more than 60 days late can trigger a penalty rate. Compare a card offer on the balance transfer calculator or check minimum payments on the credit card minimum payment calculator.
Assumptions and limits
- Each current debt keeps a fixed APR, and you pay the exact monthly dollar amount entered until it hits $0. Falling minimum payments, teaser rates, penalty rates, annual fees, and new charges are left out.
- In the result cards, the fee is added to the loan (L = debts × (1 + fee ÷ 100)). The table also shows the grossed-up loan under 12 CFR 1026.18(b)(3) when the lender takes the fee out of the cash sent (L = debts ÷ (1 − fee ÷ 100)).
- Interest on each debt and on the new loan accrues monthly at APR ÷ 12. Cards that figure interest by the day cost a little more.
- Loan APR is figured by the actuarial rule in 12 CFR 1026.22 and Appendix J on the net debt paid off ($18,500.00 on the defaults).
- Total saved compares plain sums of dollars paid across each path's payoff time, without time-value discounting.
- Market benchmarks come from the Federal Reserve's G.19 release of October 7, 2026 (August 2026 commercial-bank data, led by the 22.36% average on credit cards assessed interest). Go by your loan offer's Truth in Lending box.
These figures are estimates for learning and planning, not financial, tax, legal or investment advice. Terms of use.
What to do with your result
Check Total Saved before New Payment. Shortening the default loan from 48 months to 36 months raises the payment to $645.10 a month and lifts your savings to $4,152.51. Even a 24-month term ($914.31 a month) saves $5,432.46 if your budget can handle it.
Compare the loan's APR (14.63% here) and break-even rate (17.97%) before signing. If you have two loan offers with different fees and terms, line them up in the loan comparison calculator.
If the new loan lowers your bill, consider sending the $88.56 monthly savings back as an extra payment. Keeping your old outlay clears the default loan in 40 months and saves $3,791.09 overall.
Before you borrow, check what paying off your cards on your own would cost. The credit card payoff calculator tests one card, and the debt payoff calculator shows what an avalanche order saves on your current balances with $0 in loan fees.
Frequently asked questions
Why can a consolidation loan with a lower monthly payment cost more overall?
A longer term keeps the balance open for more months, so interest runs longer. Stretching the default 11.99% loan from 48 months to 60 months cuts the payment to $432.00 a month and drops your savings to $1,455.92. At 72 months ($379.66 a month) you save only $40.31, and at 84 months you lose $1,419.30.
How does an origination fee affect my consolidation loan's APR and savings?
Under Regulation Z (12 CFR 1026.4 and 12 CFR 1026.22), the fee is a finance charge that pushes the APR above the interest rate. On the default 48-month loan at 11.99%, a 5% fee lifts the APR to 14.63% and adds $1,169.00 of fee and interest ($925.00 fee plus $244.00 of interest on the fee) compared with a no-fee loan.
What is the difference between a fee added to the loan and a fee deducted from the proceeds?
When a 5% fee is added to the loan, your cards get the full payoff and you owe $19,425.00. When a lender takes 5% out of the cash sent, you must gross up the loan to $19,473.68 so your cards still get cleared. That extra $48.68 of principal adds $61.53 to your total cost over 48 months.
What interest rate do I need for debt consolidation to save money?
Your rate must sit below the break-even rate for your term and fee (17.97% on the defaults). In the rate table above, 14% saves $1,896.73 ($530.82 a month) and 16% saves $951.46 ($550.51 a month). Once the rate reaches 20% ($591.11 a month), consolidating loses $997.33.
How is the weighted average APR of my debts calculated?
Multiply each balance by its APR, add those numbers up, and divide by your total debt. On the three default balances, the yearly interest at the start is $1,839.20 + $1,237.05 + $720.00 = $3,796.25. Dividing $3,796.25 by the $18,500.00 total gives 20.52% (379,625 ÷ 18,500 = 20.5203%).
Is a 0% balance transfer card better than a debt consolidation loan?
A 0% transfer card can cost less if you clear the debt inside the promo window, such as 12 to 21 months, after a 3% to 5% transfer fee. If you need 36 to 60 months, a fixed-rate loan (11.90% average on 24-month bank personal loans in August 2026) avoids a card APR above 22% once the promo ends.
Sources
- CFPB, What do I need to know about consolidating my credit card debt? (page reviewed Sep 2, 2026)
- CFPB, What is the difference between a loan interest rate and the APR? (page reviewed Aug 28, 2026)
- CFPB, What is a personal installment loan? (page reviewed Aug 30, 2024)
- CFPB, Do personal installment loans have fees? (page reviewed Aug 30, 2024)
- Regulation Z, 12 CFR 1026.18, content of disclosures (CFPB text) (current version)
- Regulation Z, 12 CFR 1026.22, determination of annual percentage rate (CFPB text) (current version)
- Regulation Z, Appendix J to Part 1026, annual percentage rate computations for closed-end credit (CFPB text) (current version)
- Regulation Z, 12 CFR 1026.4, finance charge (CFPB text) (current version)
- Regulation Z, 12 CFR 1026.7(b)(12), the Minimum Payment Warning on a card statement (CFPB text) (current version)
- Regulation Z, Appendix M1 to Part 1026, repayment disclosures (CFPB text) (current version)
- Federal Reserve, G.19 Consumer Credit, August 2026 (page modified Oct 7, 2026)
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