Debt Consolidation Calculator
Compare your current high-interest debt against a new consolidation loan. Uses Weighted Average Interest Rate logic.
Current Debts
Interest Savings
$6,939
Paydown Trajectory
The Weighted Average Rate Trap
A consolidation loan isn't automatically cheaper just because the advertised APR looks lower than your worst card. What matters is whether it beats the blended cost of everything you currently owe. Lenders also fold an origination fee straight into the new principal, which quietly raises the bar a new loan has to clear before it actually saves you money.
The Weighted Average Rate
Consolidation Inquiries
?What is a Weighted Average Interest Rate?
It's the true blended cost of all your existing debts, calculated as the sum of each balance times its rate, divided by the total balance. A new loan only saves money if its APR beats this number, not just your highest card rate.
?Why does this tool sometimes show a loss?
If the new APR doesn't beat your weighted average rate, or the origination fee adds enough principal, total interest paid can rise even when the monthly payment feels lower. That's what the warning state above is flagging.
?Does the origination fee actually matter?
Yes. The fee is added to principal before the new monthly payment is calculated, so a 3% fee on a $16,000 balance is $480 of extra debt you're paying interest on from day one.
?Will consolidating hurt my credit score?
Short term, usually a small dip from the hard inquiry and new account. Medium term, it typically helps, since revolving utilization drops once card balances move to an installment loan.