Method
The current-debt scenario is simulated month by month using the weighted APR and current monthly payment. The consolidation scenario uses the standard amortized loan payment formula, then adds any upfront fee to the cost comparison.
Example
If current debts total $18,000 at a weighted 21% APR with $650 monthly payments, compare that payoff path with an $18,000 consolidation loan at 10.5% over 4 years. The useful result is not only the new payment, but total interest plus any origination fee.
Common mistakes
Do not use a consolidation loan to free up credit cards and then rebuild balances. The estimate assumes the old debts are paid off and no new debt is added.
What to compare
A lower monthly payment is not automatically cheaper. A longer loan term can reduce monthly pressure while increasing total interest. Compare both the payment change and total interest plus fees.
Limitations
This calculator does not model credit approval, variable rates, balance-transfer rules, hardship plans, tax effects or changes in spending. It is not debt counseling or lending advice.
References
- Consumer Financial Protection Bureau: debt collection and repayment resources, accessed 2026-05-16.
Last reviewed: 2026-05-16