If you are thinking about a consolidation loan, seek out a financial services site that has a debt consolidation loan calculator. These sites can often be found through links on article pages.

Debt consolidation calculator vary from site to site. Some calculators provide simple numeric results. Others calculators display charts. Some sites provide detailed reports including amortization schedules and detailed graphs. But the reason for all of the debt consolidation calculators is to help you determine if it makes sense for you to consolidate your debt.

The point of the a debt consolidation loan is to combine all of your multiple sources of outstanding debt into a single loan with one monthly payment. A debt consolidation calculator is used to help you make this determination.

There are two parts to a debt consolidation calculator.

In the first part, you are asked to enter all of the debt which you would like to consolidate. You will need to enter the dollar amount of the current balance for each and every one of your outstanding loans. You will also be asked to enter the monthly payment and interest rate for each credit card or loan.

The loan calculator uses this information to total your existing debt, and to calculate the total amount you will pay in interest if you maintain the present course.

The second part is to calculate a new loan for you. In order for you to do this, you need two pieces of information: 1. the number months you intend to take to pay off the loan, and 2. the interest rate. Depending on the site, an interest rate may be provided for you. There may also be a loan application fee. Once this information is entered, a new monthly payment is calculated using the total debt information calculated in the first part.

Now you need to examine the results. If your results produce a monthly payment less than your current payments, then you may want to consider the consolidation loan. However, the monthly payment is only part of the equation. What is the total interest payment for your new loan? You should also have a savings in interest as part of the package. So, if the debt consolidation calculator show both a lower monthly interest, and lower total interest, then a loan consolidation may be for you.

There are still other things to consider. Maybe you should not include certain debts in the calculation. If the debt is nearly paid, you might want to pay it off instead of including it as part of the consolidation.

Also, consult a reputable financial adviser prior to taking a consolidation loan. There may be specific issues pertaining to your personal finances that make taking out a debt consolidation loan ill advised.