Tools
Blended Rate Calculator
When you carry more than one lien, no single note rate describes what you are actually paying. This calculates the balance-weighted average across all of them.
Quick Answer
A blended rate is the weighted average interest rate across multiple loans, calculated by dividing total annual interest by total combined balances. It answers whether keeping a low first mortgage and adding a second is cheaper overall than refinancing everything into one new rate. The blended rate alone ignores term differences and closing costs, so it should be read alongside total payment and payoff horizon.
First mortgage
Second mortgage / HELOC
Blended interest rate
4.500%
The balance-weighted average rate across the liens entered.
Total outstanding balance
$500,000
Annual interest at these rates
$22,500
Weighting
Should You Really Give Up Your First Mortgage?
Your blended rate is only one part of the decision. Jonathan can compare keeping your existing loans against consolidating or restructuring the debt.
Prefer to talk? Call Jonathan at 210-993-5023
Lien detail
| Lien | Balance | Rate | Share of debt | Annual interest |
|---|---|---|---|---|
| First mortgage | $400,000 | 3.500% | 80.0% | $14,000 |
| Second mortgage / HELOC | $100,000 | 8.500% | 20.0% | $8,500 |
Blended rate = sum of (each balance × its rate) ÷ total balance. Example: $400,000 at 3.50% and $100,000 at 8.50% gives $14,000 + $8,500 = $22,500 of annual interest on $500,000, or 4.50%.
Assumptions used
- Rates are the current note rates you entered, applied to current balances.
- Variable-rate liens are treated as fixed at the rate entered, which they are not.
- Amortization, remaining term, and payment structure are not part of a blended-rate figure.
Results are estimates for educational purposes only and are based on the information and assumptions entered. They are not a loan approval, commitment to lend, or rate quote. Actual loan terms, payments, eligibility, taxes, insurance, and other costs may differ.
A blended rate alone does not determine whether consolidating or refinancing makes sense. Payment structure, remaining term on each lien, closing costs, variable-rate exposure, prepayment terms, and how long you plan to keep the property all matter.
Cascada Mortgage Advisors, Inc. DBA HomeFlow (NMLS #2470941, CA DRE #02206556) is a licensed mortgage broker, not a direct lender. Any interest rate you enter is your own assumption, not a HomeFlow rate.
What this calculator does
It combines the balances and rates of up to three liens — typically a first mortgage plus a second mortgage or HELOC — into one weighted average rate, and shows each lien's share of the total debt.
How the calculation works
Multiply each balance by its rate, sum the results, and divide by the total outstanding balance. Example: $400,000 at 3.50% produces $14,000 of annual interest and $100,000 at 8.50% produces $8,500, for $22,500 total. Divided by $500,000 of debt, the blended rate is 4.50%.
What the result means
The blended rate is the single rate that would produce the same annual interest as your current mix of liens. It is the right number to compare against a proposed consolidation rate — comparing a consolidation offer to only the low first-mortgage rate overstates the cost of consolidating, and comparing it to only the high second-lien rate understates it.
Important limitations
A blended rate ignores amortization, remaining term, and payment structure. Replacing a first mortgage with 12 years left with a new 30-year loan at a lower blended rate can still increase lifetime interest. Variable-rate liens are modeled as if their current rate were permanent, which it is not, and closing costs and prepayment terms are not part of the figure at all.