Savings from combining debts. The Debt Consolidation Calculator takes total debt to consolidate, average rate on the current debts, consolidation loan rate, tenure of the new loan, processing fee on the new loan and returns total saving plus emi at the current rates (same tenure), emi on the consolidation loan, processing fee. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
The headline interest rate is only part of what a loan costs: fees, the structure of repayments and how the rate is quoted (flat or reducing) all change the true cost. Compare offers on total interest and effective rate, not on EMI alone. Use the worked example below to check the maths against your own figures.
How the Debt Consolidation Calculator works
Consolidating high-rate card and personal debts into one cheaper loan saves interest and simplifies payments, provided the fee is small and you do not run the cards up again.
Worked example
With the example values (total debt to consolidate of $300,000, average rate on the current debts of 24%, consolidation loan rate of 12%, tenure of the new loan of 3 years, processing fee on the new loan of 2%), the total saving is $59,000.26; emi at the current rates (same tenure) $11,769.86, emi on the consolidation loan $9,964.29, processing fee $6,000.00. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is total saving calculated?
saving = (old EMI − new EMI) × months − processing fee.
Which figures do I need?
Total debt to consolidate, average rate on the current debts, consolidation loan rate, tenure of the new loan, processing fee on the new loan. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Does the result include fees and charges?
Only where there is a fee input. Processing fees, insurance and prepayment charges add to the true cost; the APR and loan comparison calculators include them.
