A Consolidation Loan is used to pay off outstanding debt that carries a higher
interest rate, such as credit card balances. Here’s an example:
Meera had 3 credit cards with outstanding balances totaling $25,000.
Credit Card Interest Rate: 19.99%
Monthly Payments: 3 payments totaling $500
Debt to be paid off in: 9 years & 1 month
She paid off her credit cards in full with a $25,000 consolidation loan.
Loan Interest Rate: 5.45%
Loan Payment: 1 payment of $493
Debt will be paid off in: 6 years
Meera will save $23,870 dollars in interest costs and be debt free 3 years sooner!
Use our PayOff Debt Calculator to find out in minutes how you could save interest with a consolidation loan and be debt free quicker.