A debt consolidation calculator can help you determine how much you can save with consolidation.
When you have multiple sources of debt, consolidation may help you save money. You may even receive extra cash flow to help you deal with unexpected expenses. These options are especially helpful if some of your existing loans have high-interest rates. Debt can be managed and if you are feeling overwhelmed try speaking to an advisor from the National Debt Helpline.
Why Should You Consider Debt Consolidation?
The first benefit of debt consolidation is simplifying your repayments. When you use debt consolidation, your existing debt is combined and paid off with a new loan. Instead of needing to pay a home loan, a credit card bill, and a car loan, you can have a single monthly repayment.
A single repayment is more convenient than juggling multiple monthly repayments. This may also eliminate some of the stress related to your debt. You will know exactly how much you owe at any point, instead of needing to review multiple loans. You also don’t have to deal with multiple deadlines or late fees.
Debt consolidation may also help you get rid of delinquent debts and stop receiving collection calls. When you get behind on a payment, is it often easy to allow the payments to stop. This negatively affects your credit score and results in significant late fees and penalties. Debt consolidation gives you a fresh start with a single loan.
Consolidating your debt may also help you get a lower interest rate. Depending on your credit score when you obtained your loans, you may have high-interest rates on some of your debt. This is especially common with credit cards. Your new loan may offer lower interest rates, helping you save even more by reducing the total interest that you pay over the life of the loan. There is a wealth of information online regarding help with debt.
How Do You Use a Debt Consolidation Calculator?
When using a debt consolidation calculator to determine your savings, you will need to include the outstanding amount on your home loan, along with the interest rate and current monthly repayment. You can then include your other existing debt.
You have the option to consolidate debt from multiple sources, including credit cards, car loans, personal loans, and other types of loans. Enter the amounts that you owe, along with the interest rate and current repayment. When these totals are entered, save your progress to view your existing debt summary.
The summary includes your total existing debt and total monthly payments. You can then enter the current total debt, your desired interest rate, and the new loan term. The Lendi debt consolidation calculator will then calculate the results to let you know how much you can save each month.
How Much Can You Save with Debt Consolidation?
This example will help illustrate the potential savings. You have an existing home loan of $80,000 with a 4.0% interest rate and $500 monthly repayments. You also have $10,000 in credit card debt with a 6.0% interest rate and $300 monthly payments. Consolidating the credit card debt with the home loan and then refinancing with a 3.6% interest rate and a 20-year term can provide over $275 in savings per month.
Start entering the details of your debt into the debt calculator to see how much you can save.