Simple Loan Payoff Calculator to Save You Thousands

Use this debt payoff planner to calculate how much interest you’ll save with a debt consolidation loan

Trying to reach your financial goals is nearly impossible if you’re weighed down be high interest loans and credit cards. You can skimp and save all you like but you’re only going to be on that hamster wheel of trying to stay ahead of the interest payments.

You can wait the 10 or 20 years it takes to payoff your loans, spending a few grand in interest, or you can save that money and much of the time with a debt consolidation loan.

Let me be clear, a debt consolidation loan won’t help everyone and it can be just as bad as the debt you had in the first place.

Loan payoff through debt consolidation is a tool. You have to know how to use that tool or you’ll smash your [financial] fingers up badly.

Use the loan payoff calculator below to estimate how much interest you can save as well as the difference in monthly payments on a consolidation loan. I explain how to use the calculator and how to save even more money in the following sections so be sure to scroll down.

Debt Type
Interest Rate
Annual Fees

New Loan Information

Months to pay off debt before and after consolidation
Monthly payment amount before and after
Interest saved in consolidation

How to Use the Loan Payoff Calculator

The calculator can be a great tool not only in helping you calculate loan payoff but as a debt payoff planner. Listing out your debts along with the interest rates and amounts owed is your first step in understanding your financial situation.

I designed the loan calculator as simply as possible but let’s walk through how to use it and how to decide if debt consolidation is right for you.

First, list out all your debts. You can click the left-side box to change the debt type to mortgage, credit card loans, auto debt, student loans or other. The loan type really doesn’t matter much for the calculations but it’s a good idea to list everything out. This is going to help you see where you owe the most and which loans charge the highest rates.

List out the amount owed, interest rate, loan payment and any annual fees for each loan. You don’t need to add ($) dollar signs and the interest rate should be a whole number. For example, an interest rate of 18% should be 18 in the box.

Note: You probably are not going to find a personal loan with rates under what you’re paying on a mortgage, so you might consider leaving that off the list. Debt consolidation is best used to pay off higher-rate loans on credit cards, car loans and other personal loans.

Annual fees are important and something a lot of people miss when calculating their loan payoff. Credit cards may charge a fee of $50 or more each year until you close the account. Those fees can add up to a lot of money if it takes you five years to pay off the card balance.

After listing out the debt you want to pay off, you’ll estimate some information on your debt consolidation loan. You can use actual rates by checking your rate here or just estimate your loan payoff.

  • Estimate an interest rate of 10% if you have a credit score of 720 or higher
  • Estimate a loan rate of 14% if you have a credit score of 650 to 720 FICO
  • Estimate a loan rate of 20% if your credit score is below 650 FICO

Note: These estimates might be far off your actual rate on a consolidation loan but are averages for what I have seen working in loan payoff. Checking your rate on a loan doesn’t hurt your credit score and it will get you a more accurate number to calculate loan payoff.

You can change the loan payoff time to three-, five- or 15-years. Most personal loans and debt consolidation are on three- or five-year terms.

You can also add any origination fees or other costs on the new loan. Most personal loans charge an origination fee of up to 5% of the loan amount. This is important to calculate the loan payoff and compare your true savings.

Clicking calculate will show you three things:

  • Months it will take to pay off all your original debt and to pay off your new consolidation loan
  • Monthly payments for both your current debt and the new consolidation loan
  • How much interest you save by consolidating your debt into one loan

Let’s look at an example using the loan payoff calculator.

Tom has two credit cards with balances of $4,500 and $2,200 and a rate of 18% on each. He also owes $6,250 on a car loan with a 16% rate. Minimum payments on the cards are $90 and $44 and the car loan has a $150 monthly payment. He pays a $50 annual fee on one of the credit cards.

loan payoff calculator example

He has a credit score of 680 and has been offered a $13,000 personal loan at a 14% rate on for 60 months. An origination fee of 2% will add $260 to the new loan.

Paying off the three original debts would take 93 months (almost 8 years) but Tom can cut that to 60 months with the debt consolidation loan. His monthly payment will be a little higher, $301 versus $284, because of the much shorter payoff period but he will save over $3,300 in interest.

debt consolidation savings

As mentioned, debt consolidation loans aren’t so good for paying off low-rate loans like mortgages and some student loans. That doesn’t mean consolidating can’t work for you, just pick which loans you pay off in the consolidation. Keep your mortgage and other low-interest loans separate, making regular monthly payments, and consolidate your other loans.

How to Save More in Your Debt Consolidation

Debt consolidation can be a great tool to lower your monthly payments and save money on interest.

  • Organize all your debts into one to make it easier to manage payoff
  • Convert bad revolving debt (credit cards) into non-revolving debt to help boost your credit score
  • Fix your payments so you know how much you have to pay each month instead of how much the credit card company tells you to pay

There are instances where loan payoff through debt consolidation won’t be as much help. Loans with very loan interest rates probably won’t benefit much from consolidation. It’s best to leave these off the loan payoff calculator when testing to see how much you can save.

It’s important to use debt consolidation the right way or you could fall into an even bigger debt trap than before.

  • Don’t use debt consolidation just to free up space on your credit cards so you can spend more. The point is to pay off your loans, not add more.
  • If you can, work on increasing your credit score for a couple of months to get better rates. You’ll be paying the consolidated rate for years so it’s important to get the best rate possible.
  • Shop around for your debt consolidation loan. It doesn’t hurt your credit score to check on a couple of different personal loan or p2p websites.
  • Understand the terms and fees of your consolidation loan before accepting the money. Use the loan payoff calculator to make sure you’re saving money and can afford the payments.

simple debt consolidation calculator

Using a loan payoff calculator won’t guarantee you’re getting a good deal on a debt consolidation loan. It’s just going to give you the facts of how much you’ll save in interest and how your monthly payments will change. Listing out your debts and calculating loan payoff is an important first step in getting your finances back on track but you’ll still need to go that extra mile budgeting and saving.