However, if Peter consolidated these debts into one loan over a five year term, Peter’s
monthly payment is reduced to $694, which is a saving of $50 per month. If he had
enough equity in his home to apply for a home equity loan instead of a personal loan,
he can pay even less interest and save $114 per month. This would mean a saving of
over $6,800 over the five year term. If Peter put these savings back to the loan,
he would find that he would pay off his debt in a much shorter timeframe, saving
him even more in interest repayments.