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When the typical debt-consolidation company advertises that they can "save you
money," what they are most often referring to is simply a reduction in your total
monthly debt payments -- not a savings in the cost of paying off your debt (interest
charges). Sure, by consolidating your payments into a single loan, you might be
paying one monthly payment that is smaller than the sum of your current monthly
payments, but if they stretch your loan out for a longer period of time you could
actually end up paying more interest by consolidating. This calculator will help
you to determine whether or not consolidating will actually reduce the cost of
retiring your debts. Instructions:
Starting with the first line of entry fields, enter each one of your debts, along
with their corresponding principal balances, interest rates and monthly payment
amounts (the last two columns will be filled in by the calculator). Once you have
entered all of the debts you wish to consolidate, click on the "Compute Current
Debt Cost" button. Next, enter the consolidating loan's interest rate, term and
any origination fees that might apply and click the "Compute Consolidation Loan
Costs" button. IMPORTANT:
In order for the this calculator to work, each debt must have the four left-hand
fields filled in (for interest-free debts enter .001 just to satisfy the required
interest-rate entry). Also, be sure to enter only numbers and decimal points in
the numeric entry fields. Dollar signs, percent signs, commas and spaces will
cause a JavaScript error.
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