See whether consolidating multiple debts into one loan actually saves you money versus your current blended rate.
Disclaimer
This calculator provides estimates for educational purposes only. Results are based on the inputs you provide and standard financial formulas. They do not constitute financial, investment, tax, or legal advice. Consult a qualified professional before making financial decisions.
Only when the new loan's interest rate is meaningfully lower than the balance-weighted average rate of your current debts. Consolidating high-rate credit card debt into a lower-rate personal loan often helps; consolidating into a similar or higher rate does not.
No — it restructures debt, it doesn't address why the debt built up. Many people who consolidate credit cards run up new balances on the now-empty cards, ending up with more total debt than before.
Consolidation combines debts into one new loan with one rate. Avalanche and snowball (see our Debt Payoff Planner) are strategies for the order you pay off existing debts without taking out a new loan — you can compare both approaches to see which saves more in your situation.
It can cause a small, temporary dip from the credit check and new account, but responsibly paying down a consolidation loan (and not running up the old cards again) can help your score over time by lowering credit utilization.
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