Debt Consolidation Calculator

What debt consolidation means

Debt consolidation means replacing several debts with a single new loan, ideally at a lower overall cost or with one simpler payment. It only helps if the new loan is genuinely cheaper and you do not run the old accounts up again.

This calculator shows the numbers side by side so you can judge for yourself. It does not tell you whether you would be accepted, or what rate you would be offered.

Things to check before you borrow

Look at the total you will repay, not just the monthly payment. Check for arrangement fees and early repayment charges, and be wary of securing the loan against your home. If your debts are already hard to manage, speak to a free debt adviser first.

How to use this calculator

1. Enter each debt you would pay off: its balance, APR and the monthly payment you make now.
2. Enter the loan you have been offered: APR, term in months and any arrangement fee as a percentage.
3. Compare the two columns. The "difference" line shows which costs less overall on these numbers.

How it is calculated

Current debts: each month interest is added at APR ÷ 12 and your payments are applied until every balance is cleared.

Loan: the borrowed amount is the total of your debts plus any fee. The monthly payment is a standard repayment-loan calculation using the APR.

Worked example

A £3,000 card at 22.9% APR paid at £100 a month takes 45 months and costs £4,495.50 in total. A £3,000 loan at 9.9% APR over 36 months costs £96.07 a month and £3,458.42 in total, a difference of £1,037.08 on these numbers.

Assumptions and limits

• You keep making your current monthly payments until the debts clear, with no new borrowing.
• The loan rate is fixed and the fee is added to the amount borrowed.
• Early repayment charges on existing debts, and the effect on your credit file, are not included.
• A lower monthly payment over a longer term can still cost more overall. Compare the totals, not just the monthly payment.