Frequently asked questions
When does debt consolidation make sense?
When the consolidation loan's rate is meaningfully lower than your current weighted average, and the total cost (including fees) is less than staying on your current path. A lower rate alone doesn't guarantee savings if the new term is much longer.
Does a longer term cancel out the rate savings?
It can. Stretching the term reduces monthly payments but increases total interest. A 5-year loan at 10% costs less total interest than a 10-year loan at 8%. Compare total cost, not just the monthly payment.
What about origination fees?
Most consolidation loans charge 1–6% upfront. Add that to the total cost when comparing. The calculator shows interest savings; subtract any fee to get net savings.
Will consolidation hurt my credit score?
Short term: a small dip from the hard inquiry and new account. Medium term: it often improves your score by lowering credit utilization and simplifying payments. Just avoid running up the freed credit cards again.
Should I consolidate or use the avalanche method?
If you qualify for a significantly lower rate, consolidation often wins on total cost. If you cannot get a better rate, the avalanche method (paying highest-rate first) is the next best strategy. You can also combine both.