Debt consolidation calculator
Compare keeping your debts with one consolidation loan, including fees and the total interest.
About the debt consolidation calculator
Compare keeping your debts with one consolidation loan, including fees and the total interest.
Part of SmartCalcy’s finance tools. It runs in your browser with no account, uses your own currency and units (change them at the top of the page), and gives estimates for information only, so check official guidance before you rely on a result.
How to use the debt consolidation calculator
What it calculates and when to use it
Compares keeping your current debts with replacing them by one consolidation loan, including any arrangement fee, monthly payment and total interest.
How to use it, step by step
- List the debts with their balances, rates and payments.
- Enter the new loan’s rate, term and fee.
- Compare the monthly payment, term and total interest.
What each input means
- New loan rate and term – The offered interest rate and years.
- Arrangement fee – A percentage added to the loan.
How to read the results
- Savings or extra cost – Interest on current debts minus interest on the new loan.
- Monthly payment – The new payment compared with your current payments.
The formula
New loan = total balances × (1 + fee). Payment = loan × r ÷ (1 − (1 + r)^−n). Interest on the current debts comes from paying each at its own minimum until cleared.
A worked example
A 4,500 card at 22.9% and a 6,000 loan at 12.9% (payments 325 a month) consolidated into a 4-year 9.9% loan with no fee have a payment of 265.80 instead. Total interest drops from 3,931 to 2,259, a saving of about 1,673.
Assumptions and limits
- The new loan is fixed-rate and no new debt is run up.
- Early repayment charges on old debts are not modelled.
Common mistakes
- Choosing the lowest payment rather than the lowest total cost.
- Running up the cleared cards again.
Frequently asked questions
When does consolidation not help?
If the new rate is not clearly lower, if the term is much longer or if fees cancel the savings.
Related tools
Details
- New monthly payment
- £265.80£325.00 now
- New loan
- £10,5004 years at 9.9%
- Interest on the new loan
- £2,259
- Interest on your current debts
- £3,931paid off in 3 years, 9 months
- Time to be debt-free
- 4 years vs 3 years, 9 months