I’m having difficulties wrapping my head around the equations and formulas to determine the financial benefit, or lack thereof, of a theoretical use of lower rate loans to pay higher rate loans. So I'm hoping you mathmagicians can help out, thanks in advance.
Say you had a loan of 300k @ 5% and could repeatedly obtain 10k loans @ 3%. Would there be any financial benefit to take the 10k loan put immediately towards the 300k loan and once the 10k loan is paid off take another 10k loan to put towards the 300k loan, rinse repeat until 300k loan paid off? Trying to keep it simple, make whatever assumptions necessary to fill in missing variables. I’m interested in the math rather than the practicality and applicability.