When there are multiple credits at the same time, monthly installments can represent a significant part of the family budget. Consolidation allows to gather different loans into a single financing, possibly reducing the monthly amount to pay.

How does consolidated credit work?

Consolidated credit allows grouping multiple loans into a single loan. Depending on the operation conditions, the new credit pays off previous loans, leaving the customer with a single payment.

Different types of consumer credit, such as personal, car or credit cards, can be covered according to the solution provided by the institution.

The goal may be to simplify financial management and adjust monthly expenses to payment capacity. Approval depends, however, on solvency evaluation and applicable conditions.

Consolidar brings real savings?

One of the advantages of credit consolidation is the possibility to reduce the total monthly installments, easing the family budget.

One way to achieve it is to extend the repayment period. By spreading the payment over more months, the monthly charge decreases and you'll have more budget room to cover daily expenses.

Even if this reduction does not represent a savings in the total cost of the credit, it can be an important solution for those who need to ease monthly expenses and gain greater financial capacity.

The key is to understand the short and long-term impact of the operation. For this, there are four indicators you should analyze:

Monthly payment: the amount you pay regularly and the impact it has on your budget.
APR: the annual effective global cost rate, which includes interest and other costs and allows comparing offers.
MTIC: the total amount charged to the consumer, allowing to know how much will be paid at the end of the financing.
Term: the period during which you will be responsible for payment.

How to compare the cost before and after consolidation?

The first step is to gather credit contracts and identify the outstanding capital, monthly payments, interest rates, and remaining terms.

Afterward, it is important to analyze a consolidation proposal and compare the conditions of the new financing with the charges you would still have to bear with current credits. Do not forget to include any possible early repayment commissions of the credits that will be settled.

Calculate the total cost

Imagine you currently pay several installments totaling 650 euros and still have 36 months left to pay. Until the end, you would pay 23,400 euros.

The consolidation proposal offers a payment of 430 euros, but with a 72-month term. In total, you would pay 30,960 euros.

The result: now has 220 euros more available per month, but pays about 7,560 euros more at the end of the financing.

This is the price of the monthly break. Knowing this value helps decide clearly if the budget relief is worth the extra cost.

The values are for illustration only and do not include commissions or other charges. The comparison should use real offers and equivalent estimates.

When does it make sense to consolidate?

Consolidation may pay off if:

current installments no longer fit the budget or there is a risk of missing payments;
credits include cards or revolving credit with very high fees — in this case, consolidation may even reduce the total cost;
Plan to use the monthly surplus to prepay when your financial situation improves.

It may not be worth it if your budget already supports current payments and the only goal is to have more money to spend.

After consolidating, avoid accumulating debt on credit cards or other products - otherwise, you lose the benefit of the operation.

The essential thing is to find a balance between a monthly payment you can afford and a total cost suitable for your financial capacity.

Consolidate your loan simulation

Do you have several credits and want to ease your monthly budget?

At Poupança no Minuto, we analyze your situation and look for consolidation solutions tailored to your needs. Our experts help compare offers, evaluate payment, TAEG, term, and total financing cost, so you can make an informed decision.

Make a free and no-obligation simulation.

FAQ

Does consolidation always reduce the total debt value?

No. It can reduce the monthly payment, but the total cost depends on the term, interest rates, and fees of the new contract.

Can I consolidate credits with different terms?

Yes, under certain conditions. The institution will have to analyze the contracts, the debt amounts, and the payment capacity.

How do I know if I'm really saving?

Compare the future cost of current credits with the total cost of consolidation, including interest, fees, and other charges. Don't limit yourself to the difference between monthly installments.

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