Debt Payoff Calculators
Debt Consolidation Calculator
A lower rate isn't automatically a better deal — stretching the term can add more interest than the lower rate saves. This compares total cost, not just the sticker rate.
Compare consolidating vs. keeping your debts separate
For unsecured debt — credit cards, personal loans, payday loans. Leave out auto loans or already-low-rate student loans; those have better options elsewhere.
Your current debts
New consolidation loan
Keep debts separate
At your current combined payment
Consolidate
New loan, fixed term
Weighted average rate = each balance × its APR, summed, divided by total balance. Current-path payoff uses your entered monthly payment applied at that weighted rate. This is a planning estimate — your actual consolidation loan rate depends on your credit profile.
What debt consolidation actually is
Debt consolidation combines multiple debts — typically high-rate unsecured debt like credit cards, personal loans, or payday loans — into a single new loan, usually to get a lower interest rate, a single monthly payment, or both. It's not debt forgiveness or debt settlement; you still owe the full amount, just to one lender instead of several.
The number that actually matters: total interest, not the rate
Weighted average rate: what you're really paying now
If you have multiple debts at different rates, your effective cost isn't a simple average of the rates — it's a weighted average, accounting for how much you owe at each rate: each balance times its APR, summed across all debts, divided by the total balance. A $5,000 balance at 24% pulls the weighted average up more than a $1,000 balance at 24% would, since more of your total debt sits at that rate.
Origination fees, and the break-even question
Most personal loans used for consolidation charge a one-time origination fee — typically 1% to 8% of the loan amount — deducted from what you actually receive or added to your balance. A 3% fee on a $9,000 loan is $270, money that needs to be recouped through interest savings before consolidation is a net win. If your monthly payment drops by $30 after consolidating, that fee takes about 9 months to break even — worth calculating explicitly rather than assuming any fee-bearing loan is automatically worth it.
When consolidation makes sense — and when it doesn't
| Consolidation tends to win when | Staying separate (or DIY payoff) tends to win when |
|---|---|
| Your new rate is 5+ percentage points below your weighted average | You can't qualify for a meaningfully lower rate |
| The new term is similar to your current payoff timeline | Some existing debt is already at 0% promotional APR |
| You won't run up new balances on freed-up credit cards | You can free up extra monthly budget to attack your highest-rate debt directly |
If you'd rather tackle existing debts directly instead of taking out a new loan, our Credit Card Debt Payoff Calculator models the snowball and avalanche methods on your existing balances without introducing a new loan at all.
Weighted average rate methodology, origination fee mechanics, and the term-extension risk cross-verified against multiple independent 2026 debt consolidation guides, including matching worked examples. This is a planning estimate — actual loan offers depend on your credit profile and the specific lender.
Frequently asked questions
Before you consolidate debt.
Is debt consolidation the same as debt settlement?
No. Consolidation combines debts into a new loan you fully repay, usually at a better rate. Settlement negotiates paying less than you owe, which typically damages your credit significantly more.
How is the weighted average interest rate calculated?
Multiply each debt's balance by its APR, sum those figures across all your debts, then divide by your total balance. This reflects your true blended cost better than simply averaging the rates.
Can a lower interest rate still cost me more overall?
Yes — if the new loan's term is significantly longer than your current payoff timeline would be, the extra months of interest can outweigh the benefit of a lower rate. Always compare total interest paid, not just the monthly payment.
What is an origination fee?
A one-time upfront charge, typically 1-8% of the loan amount, deducted from your loan proceeds or added to your balance. It needs to be recouped through interest savings before consolidation is a net financial win.
Should I include my car loan or student loans in a consolidation calculator?
Generally no — debt consolidation calculators are built for high-rate unsecured debt like credit cards and personal loans. Auto loans and already-low-rate student loans usually have better dedicated refinancing options.