Plug in your current debts to see ways to consolidate, and estimate your savings with a consolidation loan.
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The debt consolidation calculator below can help you decide if consolidation is right for you. The calculator will suggest the best way to consolidate your debt and estimate your savings with a debt consolidation loan.
Step 1: Enter the balances, interest rates and monthly payments you currently make toward your unsecured debts, like credit cards, personal loans and payday loans.
Don't include secured debts like car loans or low-rate student loans here. There are better ways to manage those debts. (Learn more about auto refinancing and student loan refinance options.)
Click "I'm done" and look at the calculator results, based on the figures you entered:
Total balance: The sum of all your debts, or what you owe in total.
Combined interest rate: Your average weighted interest rate for all the debts you put in the calculator.
Total monthly payment: The amount you're paying monthly toward these debts, including interest.
When you'll be debt-free: The amount of time until you are debt-free, based on your current balance and monthly payments.
Step 2: Choose your credit score range to see your debt consolidation options. Depending on the size of your debt and credit score, a balance transfer card or debt consolidation loan may be a good fit.
If you’re interested in a consolidation loan, drag the sliders below the table to enter an estimated rate and the repayment term you want (in years) for the new loan.
Step 3: Look at the comparison between your current debts and the new debt consolidation loan.
Debt consolidation makes the most sense when your new total payment is less than your current total payment, and you save money on interest.
Ways to consolidate debt
Debt consolidation loan: These loans, usually from an online lender, credit union or bank, provide a large amount of money to pay off multiple debts at once, leaving you with only one monthly debt payment. Terms typically range from one to seven years.
Balance transfer credit card: This option transfers credit card debt to a credit card that charges no interest for a promotional period, typically 15 to 21 months, making the debt easier to pay off.
Debt management plan: This option combines several debts into a single monthly payment at a lower interest rate than most credit cards or loans. It typically includes small startup and monthly fees, and it usually takes three to five years to repay the debt.
Home equity loan: If you own your home, you may be able to get a loan based on the equity in your home to pay off your other debts, but you risk losing your home if you don’t keep up with the payments.
Retirement account loan: If you have an employer-sponsored retirement account, like a 401(k), you could take out some of that money to pay off your debts. The downsides are less funds for your retirement, and if you can’t repay the loan, you’ll owe penalties and taxes.
Debt consolidation options for bad credit
Debt consolidation loans for bad credit are available from many online lenders. These loans have terms ranging from two to seven years, and amounts can be high as $50,000. Some lenders may have a minimum credit score requirement between 550 and 600, while others may accept borrowers with no minimum credit score.
Credit unions are another smart place to turn, since they tend to look more favorably on bad-credit borrowers. Check with your local credit union first, though you can also look for national credit unions that offer personal loans.
If you can’t qualify for a debt consolidation loan with a low enough interest rate, debt payoff options like the debt snowball and debt avalanche methods are good alternatives. These DIY strategies can be extremely effective and don’t require you to apply for credit.
Do debt consolidation loans hurt my credit score?
You may see a temporary dip in your credit score after applying for a debt consolidation loan, because lenders require a hard credit pull, which knocks a few points off your score.
However, if you make on-time payments on the new loan and avoid running up new debt, your credit scores should rebound and even grow over time. This can make it easier to qualify for more affordable financing in the future.
If you’re not sure whether debt consolidation is right for you, consider the benefits and risks to consolidating your debts.
Pros
You pay less in interest.
You may get out of debt faster.
You have only one payment.
You have a clear finish line.
Cons
You may not qualify for a low enough rate.
You still have debt you need to manage.
Consolidation won’t fix core spending issues.
Pros of debt consolidation
You pay less in interest: If you consolidate with a product that has a lower interest rate than your credit cards or other debts, you’ll save money on interest. This can make getting out of debt easier.
You may get out of debt faster: Since you’re paying less interest, you could potentially apply those savings to your debt repayment and get out of debt even faster.
You have only one payment: Instead of juggling multiple debt repayments, consolidating your debts means you only have to worry about making one payment. This can help you avoid late fees or additional interest.
You have a clear finish line: Paying off debt is challenging, but with consolidation, you have a clear plan and a finish line to work toward. As long as you make your payments on time, you’ll know when you’ll be out of debt for good.
Cons of debt consolidation
You may not qualify for a low enough rate: Depending on your credit score, you may not be able to qualify for a lower interest rate than your current debts, in which case, consolidation may not be the best option.
You still have debt you need to manage: Debt consolidation doesn’t mean you’re debt-free. You still have to manage payments for your new loan, balance-transfer card or other consolidation product.
Consolidation won’t fix core spending issues: If you struggle with chronic overspending, especially with credit cards, consolidation may make things worse since it frees up your credit cards to be used again.
Which lender is right for me?
NerdWallet has reviewed more than 35 lenders to help you choose one that’s right for you. Below is a list of lenders that offer standout debt consolidation loans.
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Our team of consumer lending experts follow an objective and robust methodology to rate lenders and pick the best.
35+
Lenders reviewed
We review over 35 lenders, including major banks, top credit unions, leading digital platforms, and high interest installment lenders operating across multiple states.
25+
Categories assessed
Each lender is evaluated across five weighted categories and 27 subcategories, covering affordability, eligibility, consumer experience, flexibility, and application process.
70+
Data points analyzed
Our team tracks and reassesses hundreds of data points annually, including APR ranges, fees, credit requirements, and borrower tools, ensuring up to date, accurate comparisons.
Star rating categories
We evaluate more categories than competitors and carefully weigh how each factor impacts your experience.
Affordability25%
We review lenders’ annual percentage rate offerings at least twice per year and the competitiveness of each lenders’ APR range. We also assess whether a lender charges an origination fee and any opportunity for borrowers to receive a rate discount.
Customer experience20%
We consider the experience of the consumer trying to manage a personal loan, which means accessibility of customer service representatives, whether borrowers can choose and change their payment due date, and the ability to track their loan on a mobile app.
Underwriting and eligibility20%
We consider the rigorousness of each lender’s underwriting practices and how widely available their loans are. This category includes whether a lender does a hard credit check before providing a loan, the range of credit profiles they accept and how many states their loans are offered in.
Loan flexibility20%
We assess how flexible lenders can be with borrowers, including whether they offer multiple loan types, personal loan amounts and repayment term options and whether they offer direct payment to creditors on debt consolidation loans.
Application process15%
We consider the lender’s full application process, including a borrower’s ability to preview their loan offer via pre-qualification, whether basic loan information such as APR range and repayment terms are available and easy to find online and how quickly a loan can be funded after approval.
5.0
Overall score
NerdWallet’s review process evaluates and rates personal loan products from more than 35 financial technology companies and financial institutions. We collect over 70 data points and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
