- Loan balance
- Loan balance is the total remaining balance on a loan. If you are uncertain of your exact balance, enter an estimate that is as close as possible.
- Loan payment
- The payment amount is your current monthly payment.
- Remaining payments
- The number of months you have left to make payments on a loan. This is calculated from the interest rate, monthly payment and current balance of the loan.
- Loan interest rate
- Annual interest rate for this loan. Interest is calculated monthly on the current outstanding balance of your loan at 1/12 of the annual rate.
- Credit card / credit line balance
- The outstanding balance on your credit card. You do not need to include finance charges; they will be calculated based on your interest rate.
- Credit card / credit line rate
- Annual interest rate you pay on outstanding credit card balances. This calculator assumes simple interest is charged every month at 1/12th of your annual rate.
- Credit card payment
- Credit card payments are based on your outstanding balance and annual interest rate. For this loan comparison, the monthly payment is the amount required to pay off your credit card in the same number of months as your consolidation loan. Your actual credit card payment may be lower, but will often require many more payments.
- Interest rate
- Annual interest rate for your new consolidation loan.
- Term in months
- Number of months for your new consolidation loan.
- Up front costs
- Any fees you are required to pay up front to receive this loan.
- Rate earned on savings
- This is the rate of return you would expect to make on your closing costs, if you were to invest them. This could include appraisal fees, loan origination fees, etc.
The actual rate of return is largely dependent on the type of investments you select. For example, the total return including dividends of the S&P/TSX Composite Index for the 10 year period from December 31, 2013 through December 31, 2023 was 8.6% (source www.spglobal.com). Savings accounts at a bank or credit union may pay as little as 2% or less. It is important to remember that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment.
- Include closing costs in loan
- If you include your closing costs in your loan, your loan balance, monthly payment and total interest paid will increase. You will, however, be required to pay less money up front. Including your closing costs in your loan may be a good option if you do not have funds available, or you can achieve a relatively high rate of return on your savings.
