A lender says one loan can replace all your EMIs, and the new EMI looks lower. That feels like a win. But a lower EMI and a cheaper loan are not the same thing, and the only way to know which one you are being offered is to do the maths.
Short answer: A debt consolidation calculator compares what you will pay if you keep your current debts with what you will pay on one new loan, including the processing fee, GST and foreclosure charges. If the new total is lower, consolidation saves money. If only the EMI is lower, you are buying monthly breathing room at a higher total cost, which may still be worth it, but you should know the price.
Debt consolidation calculator
Enter what you pay today and the offer you are considering. Figures stay in your browser.
This is an estimate. It assumes your current EMIs stay the same until the loans end and the new loan is on a reducing balance. Your lender’s Key Fact Statement (KFS) shows the actual APR and total amount payable.
What you enter, and why each number matters
The calculator above asks for a few figures from each of your current debts and the new offer.
For each current debt:
- Outstanding amount: what you would need to close it today.
- Monthly payment: the EMI, or what you actually pay on a credit card.
- Interest rate or APR: from your statement or Key Fact Statement (KFS). For credit cards, revolving interest is typically around 3–3.75% a month, with 18% GST on the interest.
- Months left: for loans with a fixed tenure.
- Foreclosure charge: many fixed-rate personal loans charge a few percent of the outstanding plus GST to close early. Check your agreement.
For the new loan:
- Loan amount, rate and tenure: the rate should be on a reducing-balance basis. If an offer quotes a flat rate, convert it first with our flat vs reducing rate tool.
- Processing fee: plus 18% GST, usually deducted from the amount you receive.
The maths behind the calculator
The calculator works out four things.
- Your current monthly outgo: the sum of all your EMIs and card payments today.
- Your current total repayment: every rupee left to pay if you carry on as you are. For loans, that is EMI × months left. For credit cards, it runs the balance month by month: interest at the card rate plus GST is added, your payment is subtracted, until the balance reaches zero.
- The new EMI and new total repayment, using the standard formula: EMI = P × r × (1+r)^n / ((1+r)^n − 1), where P is the loan amount, r is the annual rate ÷ 12, and n is the number of months. New total = EMI × n. Because the fee is deducted from the loan, the amount you borrow must cover your debts plus the fee plus any foreclosure charges.
- Break-even: how many months of interest savings it takes to recover the upfront costs (processing fee + GST + foreclosure charges). A rough way to estimate it: upfront costs ÷ (current monthly interest − new monthly interest).
Example 1: consolidation that saves money
Kiran, 30, Hyderabad, has two debts. This is an illustrative example.
- A credit card balance of ₹1,50,000 at 3.5% a month, on which he pays ₹9,000 a month. At that pace it takes 29 months to clear and costs about ₹2,59,300 in total, including GST on interest.
- A personal loan with ₹1,00,000 outstanding at 20%, 18 months left. The EMI is ₹6,476, so ₹1,16,574 is left to pay.
Current position: ₹15,476 a month, about ₹3.76 lakh still to repay.
The offer (example terms): ₹2,60,000 at 16% a year, 1.5% processing fee.
- Processing fee: ₹3,900 + ₹702 GST = ₹4,602, deducted upfront. He receives ₹2,55,398.
- Foreclosure on the personal loan: 4% of ₹1,00,000 = ₹4,000 + ₹720 GST = ₹4,720.
- He needs ₹1,50,000 + ₹1,00,000 + ₹4,720 = ₹2,54,720, so the loan covers everything with ₹678 to spare.
| Option | Monthly payment | Total to repay | Compared with now |
|---|---|---|---|
| Keep current debts | ₹15,476 | about ₹3.76 lakh | — |
| New loan, 24 months | ₹12,730 | about ₹3.06 lakh | about ₹70,300 less |
| New loan, 36 months | ₹9,141 | about ₹3.29 lakh | about ₹46,800 less |
Break-even: his upfront costs are ₹4,602 + ₹4,720 = ₹9,322. In the first month his current debts charge about ₹7,862 in interest (₹5,250 + ₹945 GST on the card, ₹1,667 on the loan). The new loan charges about ₹3,467. The difference, ₹4,395 a month, recovers the upfront costs in just over two months.
Both tenures save money because the card rate is so high, but the 24-month loan saves more.
Example 2: a lower EMI that costs more
Meena, 34, Jaipur, has two personal loans, both with 18 months left. This is also an illustrative example.
- ₹1,80,000 at 14%: EMI ₹11,145
- ₹1,20,000 at 15%: EMI ₹7,486
Current position: ₹18,631 a month, about ₹3.35 lakh still to repay.
The offer (example terms): a single loan at 15%, with a 2% processing fee. Foreclosure on her two loans is 3% plus GST: ₹9,000 + ₹1,620 = ₹10,620. To cover ₹3,00,000 plus that charge after the fee is deducted, she must borrow ₹3,20,000. The fee is ₹6,400 + ₹1,152 GST = ₹7,552, so she receives ₹3,12,448.
| Option | Monthly payment | Total to repay | Compared with now |
|---|---|---|---|
| Keep current loans | ₹18,631 | about ₹3.35 lakh | — |
| New loan, 18 months | ₹19,963 | about ₹3.59 lakh | about ₹24,000 more |
| New loan, 48 months | ₹8,906 | about ₹4.27 lakh | about ₹92,100 more |
The 48-month EMI is less than half her current outgo, which looks attractive. But she would pay about ₹92,100 more in total, and there is no break-even: the new rate is no lower than her old rates, so there is no interest saving to recover the fees. Even at the same 18-month tenure, the fees and foreclosure charges alone make it more expensive.
If Meena’s real problem is cash flow, a longer tenure may still be a reasonable choice. But she should make it knowingly, and she could also ask her current lenders about restructuring. Our explainer on what extending tenure really does covers this trade-off.
Want to see whether one loan would actually cost you less? Check your options with your real numbers.
How to read your result
- New total lower, EMI lower: consolidation is likely worthwhile. Pick the shortest tenure you can afford.
- New total lower, EMI higher: you save money but need a bigger monthly budget. Check you can manage it for the whole tenure.
- New total higher, EMI lower: you are paying extra for cash-flow relief. Decide if that relief is worth the cost.
- New total higher, EMI higher: walk away.
Read the full framework in when debt consolidation makes sense, and when it doesn’t, and the step-by-step process in our EMI consolidation guide. For quick checks, our EMI calculator and EMI comparison calculator help too.
Check before you apply
- The APR and total amount payable in the Key Fact Statement (KFS), compared with what you pay today
- Processing fee plus 18% GST, and any insurance or add-ons (ask whether they are optional)
- Foreclosure charges on your existing loans and on the new loan
- That the new loan covers every debt you plan to close, and that you will get a closure letter or NOC for each
- Whether the new EMI fits your monthly budget after essentials and savings
- That the lender is RBI-regulated: check our lender directory and loan app directory
Frequently asked questions
How do I calculate if debt consolidation is worth it?
Add up everything left to pay on your current debts. Then add up the new loan’s EMI × tenure, and make sure the loan amount covers the processing fee, GST and foreclosure charges. If the new total is lower, it saves money.
Should I include the processing fee in the calculation?
Yes. The fee and its 18% GST are usually deducted from the amount you receive, so you must borrow more to cover your debts. Our guide to reading the KFS for hidden costs lists other charges to check.
Why is my new EMI lower but the total higher?
Usually because the tenure is longer. Spreading the same debt over more months lowers each payment but means you pay interest for longer. Fees and foreclosure charges add to the gap.
Is the calculator result a loan offer?
No. It is an estimate from the numbers you enter. The lender’s KFS shows the final APR and total amount payable before you sign.
Disclosure: FundsTiger (Gatimaan Finance Advisors Pvt. Ltd.) is a loan marketplace and lending service provider for RBI-regulated lenders. Aparampaar Finance Pvt. Ltd. (Omozing), one of those lenders, is a related party of FundsTiger. This article is general information, not financial advice. Read your loan agreement and KFS before you decide.