Debt Consolidation Savings Calculator
This calculator estimates what you would pay in interest if you kept up to three debts separate, what you would pay if you replaced them with one loan, and the difference between the two. It is an arithmetic comparison, not a quote.
$58.27 less per month
A lower payment over a longer term can cost more in total interest even though it feels easier month to month. Compare the interest lines, not the payments. Consumer proposals and debt management plans are different tools with different consequences.
What the calculator is adding up
The page puts up to three existing debts beside one replacement loan. For each existing debt it estimates the interest you would pay over the length of the consolidation term if that balance and rate stayed where they are. It adds those figures together. It then estimates the interest on a single loan covering the same total balance, at the consolidation rate and term you entered. The gap between the two interest totals is the figure the page labels savings.
That figure is an arithmetic comparison of two scenarios you described. It is not a quote, not a rate offer, and not a decision about whether anyone will lend to you. loanmoose.ca is not a lender and does not make credit decisions, set rates, or issue approvals.
What each input means
- Balance 1, Balance 2, Balance 3 — the outstanding amount on each debt as it appears on your most recent statement. Use the same date for all three so the total is coherent.
- Rate 1, Rate 2, Rate 3 (%) — the annual interest rate on each of those debts, written as a percentage. Use the rate currently being charged, not a promotional rate that has already expired.
- Consolidation rate (%) — the annual rate on the single loan you are comparing against. If you have not been given a rate in writing, the calculator is answering a hypothetical: what a rate at that level would produce.
- Consolidation term (years) — how long you would take to repay the single loan. This input moves two things at once. Lengthening the term lowers the required monthly payment and raises the total interest.
The arithmetic in words
For each existing debt, the estimated interest is the balance multiplied by its annual rate, multiplied by the number of years in the consolidation term. Add the three results. That sum stands for the cost of leaving the debts where they are across that window.
For the replacement loan, the interest calculation starts from the same total balance. The calculator derives a level monthly payment from the consolidation rate and the number of months in the term, multiplies that payment by the number of months to get the total paid, then subtracts the original balance to leave interest. Savings is the first interest total minus the second.
Two consequences follow from that structure. Because no payments are modelled against the separate debts, the comparison assumes those balances sit untouched for the whole term, which overstates their cost if you would in fact pay some of them down. And because the replacement loan does amortize, a consolidation at a lower rate can still cost more in total if the term stretches far enough.
What the result assumes
Every number on the page rests on the following:
- Balances stay at the amounts you entered for the entire term, with no new charges and no payments against them.
- Every rate stays fixed for the whole term, and no fees, insurance, or penalties are added on either side.
- Interest on the separate debts is estimated as a straight balance multiplied by rate multiplied by time, not the compounding schedule a lender would actually apply. Canadian fixed-rate mortgages are compounded semi-annually by law, and other products compound on their own schedules, so a real statement will differ from this estimate.
- The replacement loan is repaid on schedule, in full, with no missed payments and no early payoff.
- The term you entered is a term someone would actually offer you at that rate. Whether that happens depends on your credit history, your income, how much of your income is already committed to debt payments, whether the loan is secured, and the lender's own pricing. Lending in Canada is licensed provincially, so the regulator and the rules differ by province and territory.
- The consolidation rate you typed is realistic. No legal loan in Canada can carry an effective annual rate above the criminal rate of interest, which is 35% per year under s. 347 of the Criminal Code. That ceiling is a prohibition, not a market rate, and most borrowing prices far below it.
Where the consolidation rate comes from
Nothing on this page sets it. A lender prices a consolidation loan on your credit file, your income, how much of your income is already directed to debt payments, whether the loan is secured by an asset, and the term. A secured loan against property will generally carry a lower rate than an unsecured one, and federally regulated lenders commonly limit a home equity line of credit to 65% of appraised property value, with total secured lending usually capped at 80%. Federally regulated mortgage lenders also generally work to a total debt service ratio ceiling of about 44%.
If the debts you are combining are payday loans, the rules are different. Where a province operates a licensed payday lending regime, the federal Payday Lending Regulations cap the cost of borrowing at $14 per $100 advanced, some provinces set a lower cap, and the lower one applies. Quebec does not license payday lending at all, which effectively prohibits the model there. A payday loan is generally up to $1,500 for a term of 62 days or less.
The Financial Consumer Agency of Canada explains debt and borrowing options in plain terms, including what a lender has to tell you before you sign. Reviewing that before you compare rates is a reasonable first step.
Frequently asked questions
Does this calculator tell me whether I will be approved for a consolidation loan?
No. The calculator only does arithmetic on the balances and rates you type in. It does not see your credit file, your income, or your existing obligations, and it makes no lending decision. loanmoose.ca is not a lender and does not make credit decisions. Whether a lender would approve a consolidation loan, at what rate and over what term, depends on their own underwriting of your file.
Which rate should I enter for my existing debts?
Use the annual rate that appears on your most recent statement for each account, and keep the balances consistent with the same date. If you enter a promotional rate that has since expired, or a balance from an older statement, the comparison will not match what you are actually being charged. For the consolidation rate, enter a rate you have seen in writing, or treat the entire result as hypothetical.
Why can a lower consolidation rate still produce more total interest?
Because total interest depends on the rate, the balance, and the length of time, not on the rate alone. Spreading a balance over a longer term at a lower rate can accrue more interest than a higher rate over a shorter period. Shortening the term raises the required monthly payment but lowers the total interest, provided you can carry that payment comfortably.
What kinds of debts can be combined into one loan?
Unsecured debts such as credit card balances, personal loans, and lines of credit are the usual candidates, and some lenders will refinance payday debt. Secured borrowing against a vehicle or property is a separate category with its own rules and limits. Some obligations cannot be consolidated at all, income tax arrears and court judgments among them, and a consolidation loan does not reduce what you owe. It changes the rate, the term, and the number of payments.
What happens if I consolidate and then borrow on the old accounts again?
The arithmetic on this page assumes the balances you entered stay put for the whole term. If you keep the old accounts open and draw on them again, total debt rises and the comparison no longer describes your situation. Some people close or freeze the accounts they consolidate. Whether that suits you depends on your circumstances, and it is worth asking about before you sign anything.
Where can I get help if a consolidation loan is not enough?
If the debts are beyond what a single loan can manage, the options include credit counselling and, at the far end, a consumer proposal or bankruptcy. Only a licensed insolvency trustee can administer a consumer proposal or a bankruptcy, and trustees are regulated by the Office of the Superintendent of Bankruptcy Canada. A free copy of your credit report is available from each of Canada's two national bureaus, Equifax Canada and TransUnion Canada.
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