Debt Consolidation Calculator
Compare your current payments to a single consolidation loan: the new amortized monthly payment, total interest, total paid, and monthly savings.
How to use this tool
- Enter the total debt you want to consolidate.
- Enter the consolidation loan's APR and term in months.
- Enter your current combined monthly payment.
- Read the new payment, total interest, total paid, and monthly savings.
Compare your current payments to a single consolidation loan. Enter your total debt, the new loan's APR and term, and what you pay now to see the new payment, interest, and savings.
Formula
With monthly rate r = APR ÷ 12 and term n months, the amortized payment is:
Payment = P × r ÷ (1 − (1 + r)−n) (when r = 0, Payment = P ÷ n)
Total paid = Payment × n | Total interest = Total paid − P
Monthly savings = Current total payment − New payment
How it works
Debt consolidation rolls several balances into a single fixed-term loan with one payment. This calculator computes that payment with the standard amortization formula: principal times the monthly rate, divided by one minus (1 + rate) raised to the negative term. When the APR is zero the formula collapses to principal divided by the number of months. It then reports total interest over the life of the loan and how the new payment compares with what you pay today.
Consolidation can lower your monthly payment and simplify bookkeeping, but a lower payment achieved by stretching the term can raise total interest even at a lower rate. The honest comparison is total cost and total interest, not just the monthly number — which is why both are shown. Enter the combined balance, the loan's APR and term, and your current total payment to see the trade-off for your situation.
Reviewed by the AbraCalc Credit Desk. This is general information, not financial advice; confirm your card's terms (APR, fees, minimum-payment rule) with your issuer or a qualified advisor.
Worked example
$12,000 consolidated at 0% over 24 months
- With a 0% APR the payment is simply principal ÷ term: 12,000 ÷ 24 = 500.
- Total paid = 500 × 24 = 12,000; total interest = 12,000 − 12,000 = 0.
- Monthly savings = current 600 − new 500 = 100.
New monthly payment = $500.00, monthly savings = $100.00
Monthly payment to consolidate $12,000 at 0% APR
| Term | Monthly payment | Total paid |
|---|---|---|
| 12 months | $1,000.00 | $12,000 |
| 18 months | $666.67 | $12,000 |
| 24 months | $500.00 | $12,000 |
| 36 months | $333.33 | $12,000 |
| 48 months | $250.00 | $12,000 |
| 60 months | $200.00 | $12,000 |
Key terms
- Debt consolidation
- Combining multiple debts into one loan or payment, ideally at a lower rate or simpler terms.
- Amortization
- Repaying a loan with equal periodic payments that cover interest first and reduce principal over time.
- Loan term
- The number of months over which the consolidation loan is repaid.
- Total interest
- The sum of all interest paid over the loan — total payments minus the amount borrowed.
Frequently asked questions
- Does consolidating debt save money?
- It can if the new rate is lower and you do not extend the term too far. A lower monthly payment from a longer term can actually increase total interest, so compare total cost, not just the payment.
- What is the amortization formula?
- Payment = P × r ÷ (1 − (1 + r)^−n), where P is principal, r is the monthly rate (APR ÷ 12), and n is the number of months. At 0% it simplifies to P ÷ n.
- Will consolidation hurt my credit?
- Opening a new loan can cause a short-term dip from the inquiry and new account, but consistently paying it and lowering card utilization often helps over time.