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Debt Consolidation Calculator: Instantly Find Your New Loan Payment

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How Does a Debt Consolidation Calculator Help You Save?

Loan 1 Amount (₹): Interest Rate (% p.a.): Remaining Term (months):

New Consolidated Loan
Total Amount (auto): Interest Rate (% p.a.): Loan Tenure (months):

What is Debt Consolidation Calculator?

A Debt Consolidation Calculator is a digital tool designed to help users combine multiple debts into a single, more manageable loan. It provides an instant comparison between your current total loan payments and a consolidated alternative, making financial planning easier.

By entering loan amounts, interest rates, and terms, you can see your old total EMI, total interest outgo, and potential savings. This helps you evaluate if a new consolidated loan truly benefits your repayment journey.

Formula Behind Debt Consolidation Calculator

The calculator uses the EMI formula: EMI = [P × r × (1 + r)ⁿ] / [(1 + r)ⁿ – 1], where P is loan amount, r is monthly interest rate (annual rate divided by 12 and 100), and n is the number of monthly payments. Each original loan's EMI and total interest are added, then compared to the new consolidated loan's EMI and total interest, highlighting monthly and lifetime savings.

Debt Consolidation Comparison Table

Scenario	Total EMI Paid (₹/mo)	Total Interest Outgo (₹)
Before Consolidation (2 loans)	₹ 9,592	₹ 36,543
After Consolidation (1 loan)	₹ 7,063	₹ 19,512
Estimated Savings	₹ 2,529/mo	₹ 17,031

Steps to Use Debt Consolidation Calculator

Enter the amount, interest rate, and tenure for each of your existing loans.
Add more loans if needed, up to five different debts.
Input the new consolidated loan's expected rate and period, then click "Calculate".
Review your old total EMI/interest, new EMI/interest, and your possible overall savings.

Why Use Vedantu’s Debt Consolidation Calculator?

Vedantu’s calculator saves you time and complexity by simplifying comparisons between your current and consolidated debts. You see instant results in easy-to-read tables, making your decision transparent and actionable.

With a user-friendly mobile interface, you can explore real EMI and interest savings no matter your device. Combine up to five loans to assess monthly and lifetime savings, empowering both students and families to plan smarter repayments.

Applications of Debt Consolidation Calculator

This tool is essential for students, working professionals, or families juggling several EMIs—like student loans, credit cards, or personal loans. It aids in simplifying finances, lowering monthly EMIs, and reducing long-term interest outgo.

People across India, Canada, the UK, and Australia use this calculator to plan debt repayment, clear cards, centralize student loans, or get a single, predictable EMI. Use it alongside the EMI Calculator, Loan Calculator, and Simple Interest Calculator for total financial clarity.

For deeper arithmetic strategies, check out Percentage Calculator and Algebra Topics to sharpen your mathematical know-how while managing your debts efficiently.

FAQs on Debt Consolidation Calculator: Instantly Find Your New Loan Payment

1. How does a debt consolidation calculator work?

A debt consolidation calculator simplifies the process of combining multiple debts into a single loan. It works by taking your existing debts' details (amount, interest rate, and loan term) as input, along with the proposed interest rate and term for the consolidated loan. The calculator then calculates your current monthly payments, the projected monthly payment after consolidation, and the total interest savings you could achieve. This helps you quickly assess the potential benefits of debt consolidation.

2. What is the formula for debt consolidation?

There isn't one single formula for debt consolidation, but it involves several calculations. First, you sum up all your outstanding debt amounts. Then, for each debt, you calculate the individual Equated Monthly Installment (EMI) using the standard EMI formula: EMI = [P × r × (1 + r)^n] / [(1 + r)^n – 1], where P is the principal amount, r is the monthly interest rate, and n is the loan term in months. Finally, you use the same formula again to calculate the EMI for the consolidated loan, using the total debt amount, the new interest rate, and the new loan term. Comparing the sum of individual EMIs with the consolidated EMI reveals potential savings.

3. Can I reduce my interest with debt consolidation?

Yes, you potentially can. Debt consolidation can lower your overall interest payments if the new loan's interest rate is lower than the average interest rate of your existing debts. This is because you're replacing multiple high-interest debts with a single loan at a potentially lower rate. However, it’s crucial to secure a favorable interest rate on the consolidated loan to ensure you actually save money.

4. What is the monthly payment on a consolidated loan?

The monthly payment on a consolidated loan depends on several factors: the total amount of debt being consolidated, the new interest rate offered, and the chosen loan term. A debt consolidation calculator helps determine this precise figure based on your individual circumstances. A lower interest rate and/or a longer loan term will generally result in a lower monthly payment but will often lead to paying more in total interest over the life of the loan.

5. How many loans can I consolidate?

The number of loans you can consolidate depends on the lender's policies and the terms of your new loan. Some lenders may allow you to combine numerous debts, while others may impose restrictions. It's advisable to check with potential lenders about their specific eligibility criteria for debt consolidation. It's common to consolidate multiple credit cards, personal loans, and sometimes even student loans into a single debt consolidation loan.

6. How much can I save with debt consolidation?

The amount you save through debt consolidation depends entirely on the difference between your existing interest rates and the interest rate of your new loan and your existing loan terms. A lower interest rate on the consolidated loan, coupled with strategic planning for the repayment term, will maximize your potential savings. Use a debt consolidation calculator to estimate your potential savings based on your specific debt profile. Note that while you may save on interest, the total amount paid over the life of the loan might still be higher if you choose a longer term for the consolidated loan.

7. What is the difference between debt consolidation and debt settlement?

Debt consolidation involves combining multiple debts into a single loan with potentially a lower interest rate, simplifying repayments. Debt settlement, on the other hand, involves negotiating with creditors to pay off your debt for a lower amount than what you originally owed. Debt settlement can negatively affect your credit score, while debt consolidation generally has less of an impact, provided you maintain consistent repayments.

8. Is debt consolidation right for everyone?

Debt consolidation isn't a one-size-fits-all solution. It can be beneficial for individuals struggling to manage multiple debts, especially those with high-interest rates. However, it might not be suitable if you lack financial discipline or if the new loan's terms are not significantly better than your existing ones. Consider your financial situation carefully before opting for debt consolidation.

9. How does debt consolidation affect my credit score?

The impact of debt consolidation on your credit score depends on several factors. A new loan inquiry may slightly lower your score temporarily. However, if the consolidation helps you manage your debt more effectively and avoid late payments, your credit score could improve in the long run due to an improved credit utilization ratio. Conversely, if you fail to make timely repayments on the consolidated loan, your credit score will suffer.

10. What are the risks associated with debt consolidation?

While debt consolidation offers potential benefits, it also carries some risks. Securing an unsuitable interest rate on the consolidated loan could negate any savings. Extending the repayment term, although it may lower monthly payments, will ultimately lead to paying more interest overall. Moreover, if you fail to manage the consolidated loan effectively, it could lead to more serious debt problems. Carefully evaluate the pros and cons before proceeding.