Will this hurt my credit score?

Initially, applying for a loan causes a small dip. However, paying off credit cards improves your credit utilization ratio, which typically results in a net positive effect within a few months.

Should I close my credit cards after paying them off?

Not necessarily. Keeping old cards open (but unused) helps your credit history length and available credit ratio. However, if you're tempted to spend, closing them is the safer choice.

What if I can't get approved for a low-rate personal loan?

Consider a secured personal loan (using savings as collateral), a guarantor loan, or focus on paying off the highest-rate card first while making minimums on others.

Credit Card Debt Destroyer

Calculator

Calculate how a personal loan can eliminate your high-interest credit card debt faster and cheaper

Free to useNo data storedAI insightsUpdated: February 2026

Trapped in high-interest credit card debt? This calculator shows how using a personal loan to pay off your cards can save you thousands in interest and get you debt-free years sooner.

Enter Your Details

Real-World Examples

Single Card Debt

Maria has $10,000 on a card at 21% paying $250/month minimum.

Inputs Used:

balance:10,000cardRate:21payment:250plRate:9

A 3-year personal loan saves $4,800 in interest and pays off 2 years faster.

Multiple Card Balances

Tom has $25,000 across 3 cards averaging 19% paying $600/month.

Inputs Used:

balance:25,000cardRate:19payment:600plRate:11

Consolidating to one loan saves $8,200 and simplifies to one monthly payment.

Frequently Asked Questions

Glossary

Debt Consolidation

Combining multiple debts into a single loan with one interest rate and one payment.

Interest Savings

The total amount you avoid paying by switching to a lower interest rate option.

Payoff Acceleration

How much faster you become debt-free compared to current minimum payments.

Related Tools

Debt Consolidation Calculator

Combine all debts including cards and other loans

PL vs Credit Card

Compare costs for new borrowing

Debt Payoff Optimizer

Find the best strategy to pay off multiple debts

How to Use

1Enter your total credit card balance
2Find your card's interest rate on your statement
3Add what you're currently paying monthly
4Enter the personal loan rate you've been quoted
5Choose your preferred loan term to see the savings

Key Information

Credit cards average 18-22% interest in Australia
Personal loans can be as low as 7-10% for good credit
Minimum payments can take 20+ years to pay off a balance
A structured loan forces consistent debt reduction

Pro Tips

Apply for the personal loan BEFORE closing credit cards to protect your credit score
Consider a secured personal loan using savings for even lower rates
Cut up the credit cards after consolidation - don't re-accumulate debt
Set up automatic payments from your salary to never miss a payment

Avoid These Mistakes

Getting a personal loan but keeping credit cards active and accumulating new debt
Choosing the longest loan term thinking lower payments save money (they cost more)
Not comparing multiple personal loan offers - rates vary by 5%+ between lenders
Forgetting to factor in personal loan fees when calculating savings

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Interest rates, fees, and policies change frequently. Always verify information with lenders directly. This is general information, not personal financial advice. Consider seeking advice from a licensed mortgage broker or financial advisor.

Last updated: February 2026