Debt Consolidation Calculator

Estimate how consolidating multiple debts into a **single loan** can save money on **interest** and reduce **monthly payments**.

New Monthly Payment: $

Total Interest Saved: $

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Debt Consolidation Calculator - A Complete Guide

A **Debt Consolidation Calculator** helps estimate potential **savings** when consolidating multiple debts into **one loan**.

How Debt Consolidation Works

Debt consolidation allows you to combine multiple debts into a **single loan** with a potentially **lower interest rate** and a **fixed repayment plan**.

How to Calculate Savings?

The calculator considers:

• **Total Debt:** The sum of all outstanding debts.
• **Current Interest Rate:** The average interest rate of existing debts.
• **Monthly Payment:** The total amount you currently pay each month.
• **New Consolidation Loan Interest Rate:** The lower rate for the new loan.
• **Loan Term:** The number of years to pay off the consolidation loan.

Example Calculations

Example 1: A total debt of **$20,000**, with an interest rate of **18%**, and a monthly payment of **$500**.

By consolidating into a **7% interest loan for 5 years**, the new monthly payment is **$396** and total interest saved is **$4,320**.

Example 2: A total debt of **$10,000**, with an interest rate of **22%**, and a monthly payment of **$400**.

By consolidating into a **9% interest loan for 3 years**, the new monthly payment is **$318** and total interest saved is **$2,100**.

Why Use a Debt Consolidation Calculator?

• Helps determine **potential interest savings**.
• Shows if a **lower monthly payment** is possible.
• Helps in planning a **structured debt repayment strategy**.

Use this **Debt Consolidation Calculator** to compare loan options and make informed financial decisions.