Key takeaways
What to know before you compare
- Enter each current balance, rate, and actual planned payment.
- Compare current remaining interest with the new loan’s interest plus origination fee.
- The calculator grosses up a fee deducted from funding so estimated proceeds cover the entered balances.
- A longer term can lower the payment while increasing the total cost.
- The estimate assumes fixed rates and on-time payments with no new charges.
Payoff comparison
Estimate debt-consolidation break-even
Enter up to three current debts and one proposed fixed-rate loan. For each debt you include, enter its balance, APR (including 0% when applicable), and monthly payment. Leave unused rows entirely blank or at 0. Current payments are held constant until payoff; a deducted fee is grossed up so estimated net proceeds cover the entered balances.
Assumes a percentage fee is deducted from funding and grosses up the proposed principal so net proceeds equal the entered payoff balances. Actual payoff quotes, lender limits, rate calculations, and rounding may differ.
What the break-even estimate means
The calculator simulates up to three current balances month by month, then compares their accumulated interest with the proposed loan’s accumulated interest plus its origination fee. The estimated durable break-even is the first month after which the proposed cost remains no higher through the rest of the compared payoff periods.
If the new loan does not stay ahead, the result reports no durable break-even. That can happen when the fee is too large, the rate is not low enough, or the term adds too much interest.
Use realistic current-debt inputs
Minimum payments can change as balances fall, so enter the amount you genuinely plan to keep paying. The calculator holds each entered payment steady until that balance is paid. If a payment does not cover estimated monthly interest, it flags the account rather than presenting a misleading payoff.
Request current payoff statements when you move beyond planning. Accrued interest, transfer timing, and account-specific fees can change the exact amount needed.
Decide whether consolidation improves the plan
Look for a lower total cost, an affordable payment, and a payoff date you can maintain. One payment may be simpler, but convenience is not the same as savings. For a fee deducted from funding, the calculator grosses up the proposed principal so estimated net proceeds equal the entered balances. Confirm that the lender permits the resulting amount and compare it with exact payoff statements.
Finally, decide how paid-off revolving accounts will be handled. Consolidation can fail if new balances replace the debt that was just moved.
Frequently asked questions
What if the calculator shows a negative savings amount?
Under the entered assumptions, the proposed loan costs more in interest and fees than continuing the current payoff plan.
Does the calculator include changing credit-card minimums?
No. It holds the payment you enter for each account steady until payoff, which makes your intended payment plan explicit.
Is a shorter break-even always better?
It reduces the time needed to recover the fee, but the payment still must fit your budget and the full cost should still be compared.
Sources and methodology
Karma Loans uses primary government and regulatory sources for material definitions and consumer guidance. Calculators use the assumptions shown beside each tool and round displayed results to two decimal places.
Educational use only. This article and its calculators are not financial, legal, tax, or accounting advice. Karma Loans is not a lender and does not make credit decisions. Provider disclosures and signed agreements control.