Debt Consolidation > Debt Consolidation Loan Calculator

 

There are not only loan calculator personal loans but it can also help you to work out how much your monthly repayments could be on a debt consolidation loan. Should you consolidate your debt? Debt consolidation loan calculator is designed to help determine whether debt consolidation is right for you. Enter your loan amount, credit card balances and other outstanding debt. You can then see what your monthly payment would be with a consolidated loan. Try adjusting your terms, loan types or rate until you have a consolidation plan that fits your needs – and especially your budget to find!

Debt Consolidation – A Quick Guide

A debt consolidation loan is a new loan large enough to pay your existing debts. It can manage your finances easier, because it means you’ll just one payment to deal with every month, instead of many.

Many people also choose to reduce their monthly payments to the repayment of the debt consolidation loan over a longer period than their original debt. This can make your debt more manageable, and can free up extra money for other purposes.

How to Use the Debt Consolidation Loan Calculator

Before you begin, you‘ll want to add any debt you’re thinking of consolidation. The total will be much you should borrow on your debt consolidation loan.

Once you enter the amount in the How much would you borrow? The next step is to decide on the repayment period for your debt consolidation loan. It is important to ensure you can comfortably afford the repayments.

Guaranteed loans can be made available with a longer repayment period than unsecured loans, and can be supplied with a lower interest rate – but you’ll need to use your house as security against the amount you borrow. Remember not to keep the payments on a secured loan can result in your home are taken.

Finally, on the How would you describe your credit history? Slide, select the type of rating that you feel most applies to you: Poor, Average or Good. If you are not sure, a professional advisor can help you figure it out.

It’s possible to save money overall by consolidating your debts, and it’ s possible to save money on one month’s-on-month basis – but doing both at the same time would not be possible.

For example, consolidate high interest debt (like credit cards) in a debt consolidation loan with a lower interest rate you can to pay less in the long term, if you fast enough to pay back. However, since a longer repayment period means interest payable for a longer period, extending the repayment period reduces the chance to save money overall, even though your monthly repayments will be lower.

For many people a debt consolidation loan, though the reduced monthly expenses are the most important, even if it means paying a little more long term.

If you are unsure whether a debt consolidation loan saves you money, ask a debt consultant to help you do the calculations.

Debt Consolidation Calculator Definitions

• Loan amount. Loan amount is the total balance of a loan. If you are uncertain of your exact balance, enter an estimate as close as possible.
• Loan payments. The amount is your current monthly payment.
• Loan months left. The number of months you still have to make payments on a loan.
• Credit card balance. The outstanding balance on your credit card. You do not include finance charges; they will be calculated based on your interest.
• Credit card rate. Annual interest rate you pay on outstanding credit card balances. This calculator is simple interest paid each month 1/12th of your annual rate.
• Credit card payment. Credit card payments are based on the outstanding balance and annual interest. For this loan comparison, the monthly payment is to pay the amount of your credit card in as many months as your consolidation loan. Your actual credit card payment can be lower, but will often require many more payments.
• Interest rate. Annual interest rate for your new consolidation loan.
• Duration in months. Number of months for your new consolidation loan.
• Upfront costs. Any price you pay for this loan. This could include appraisal fees, loan origination fees, etc.
• Points. Number of points paid for this loan. Points are usually only paid for home equity loans.
• Rate earned on savings. This is the rate you would have received if you had your closing costs into savings. Enter your short term savings rate. For most people this is currently 2% to 5% per year. Savings account at a bank or credit union pays only 2% or less.
• Income tax. This is your combined federal and state income tax rates. It is used to determine income tax savings when you have a home equity loan to consolidate your debt.
• Loan type. The two most common types of loans, home equity and personal, differ in costs, tariffs and tax deductibility of interest. Home equity loans often have high costs, but usually have lower rates and a tax deduction for interest paid. Personal loans are not tax deductions for interest paid, and have a higher interest rate but often have lower rates. These are important considerations when choosing a loan.
• Add closing costs into the loan. If your closing costs into your loan, your loan balance, monthly payment and total interest paid will increase. You will however need to pay less money up front. Including your closing costs in your loan can be a good option if you do not have funds available, or you can reach a relatively high return on your savings.