Blended Rate Calculator
Calculate the blended interest rate across two loans or debts. Enter balances and interest rates to find your effective combined lending rate instantly.
About This Calculator
The Blended Rate Calculator computes the weighted average interest rate when combining two loans, mortgages, or debts with different balances and interest rates. This is essential for anyone evaluating loan consolidation, mortgage refinancing, or determining the true effective cost of carrying multiple debts simultaneously.
The blended rate, also known as the effective combined interest rate, is calculated using the formula: Blended Rate = (Balance₁ × Rate₁ + Balance₂ × Rate₂) / (Balance₁ + Balance₂). This weighted average accounts for the proportion each loan contributes to the total outstanding balance, giving you a single representative rate for decision-making.
Common use cases include: comparing a new mortgage offer against an existing mortgage at a different rate, evaluating debt consolidation loan options, understanding the true cost of carrying credit card balances alongside a personal loan, and analyzing the combined interest burden on business debts.
Note that the calculation assumes all loans share the same payment period (e.g. monthly or annual). If your loans have different payment periods, convert them to the same period before using this calculator.
Regional Support
India: Uses INR (₹) with default loan amounts and rates relevant to Indian borrowers. Common use includes comparing home loan top-up offers against existing home loans.
United States: Uses USD ($) with default values reflecting typical US mortgage and personal loan amounts and rates (7-9% range for 2025).
United Kingdom: Uses GBP (£) with defaults aligned to UK lending rates (5.5-7.5% range for 2025) for mortgages and personal loans.
Frequently Asked Questions
What is a blended interest rate?
A blended interest rate is the weighted average of two or more interest rates from different loans or debts, calculated by weighting each rate by the corresponding principal balance. It represents the effective single rate applicable to the total combined balance.
How is the blended rate calculated?
The blended rate is calculated by summing the product of each balance and its interest rate, then dividing by the total combined balance. The formula is: Blended Rate = (Balance1 x Rate1 + Balance2 x Rate2) / (Balance1 + Balance2).
When would I use a blended rate calculator?
You would use a blended rate calculator when comparing loan consolidation options, evaluating mortgage refinancing offers, assessing the true cost of multiple debts, or determining the effective interest rate on a combined portfolio of loans or investments.
Can I use this calculator for mortgage refinancing?
Yes. If you have an existing mortgage at one rate and are considering an additional loan or refinancing at a different rate, the blended rate calculator helps you determine the combined effective rate on the total balance, making it easier to compare with other loan offers.
Does the blended rate assume equal payment periods?
Yes. The blended rate calculation assumes all loans or amortizations share the same payment period (e.g. all monthly or all annual). The interest rates must correspond to the same period for the weighted average to be meaningful.
How does region-based auto-detection work?
The calculator detects your region from your browser timezone and automatically applies default loan amounts and rates relevant to India (INR), United States (USD), or United Kingdom (GBP). You can manually override any value and share the URL with exact inputs.
What is the difference between blended rate and APR?
A blended rate is a weighted average of multiple interest rates on different balances, while APR (Annual Percentage Rate) includes the interest rate plus other financing costs like fees and points. Both are useful but measure different aspects of loan cost.
Can I calculate blended rate for more than two loans?
This calculator handles two loans at a time. For more than two loans with the same payment period, you can combine them in pairs sequentially, or use the formula: sum of each (balance x rate) divided by total balance.