.br-calc-box {
background: #f8f9fa;
border: 1px solid #e9ecef;
border-radius: 8px;
padding: 25px;
margin-bottom: 30px;
box-shadow: 0 4px 6px rgba(0,0,0,0.05);
}
.br-calc-title {
text-align: center;
color: #2c3e50;
margin-bottom: 25px;
font-size: 24px;
font-weight: 700;
}
.br-input-row {
display: flex;
gap: 15px;
margin-bottom: 15px;
align-items: center;
flex-wrap: wrap;
}
.br-input-group {
flex: 1;
min-width: 140px;
}
.br-label {
display: block;
margin-bottom: 5px;
font-size: 14px;
font-weight: 600;
color: #495057;
}
.br-input {
width: 100%;
padding: 10px;
border: 1px solid #ced4da;
border-radius: 4px;
font-size: 16px;
box-sizing: border-box;
}
.br-row-label {
width: 100%;
font-size: 14px;
color: #6c757d;
border-bottom: 1px solid #dee2e6;
margin-bottom: 10px;
padding-bottom: 5px;
font-weight: bold;
}
.br-btn {
display: block;
width: 100%;
background-color: #007bff;
color: white;
border: none;
padding: 15px;
font-size: 18px;
font-weight: bold;
border-radius: 6px;
cursor: pointer;
margin-top: 20px;
transition: background-color 0.2s;
}
.br-btn:hover {
background-color: #0056b3;
}
.br-results {
margin-top: 25px;
padding-top: 20px;
border-top: 2px solid #e9ecef;
background: #fff;
padding: 20px;
border-radius: 6px;
text-align: center;
}
.br-result-item {
margin-bottom: 15px;
}
.br-result-label {
font-size: 14px;
color: #6c757d;
text-transform: uppercase;
letter-spacing: 1px;
}
.br-result-value {
font-size: 32px;
color: #28a745;
font-weight: 800;
}
.br-result-sub {
font-size: 20px;
color: #495057;
font-weight: 600;
}
@media (max-width: 600px) {
.br-input-row {
flex-direction: column;
gap: 10px;
}
}
function calculateBlendedRate() {
// Initialize totals
var totalWeightedInterest = 0;
var totalBalance = 0;
// Helper function to process each row
function processRow(amountId, rateId) {
var amountElem = document.getElementById(amountId);
var rateElem = document.getElementById(rateId);
var amount = parseFloat(amountElem.value);
var rate = parseFloat(rateElem.value);
// Only calculate if both amount and rate are valid numbers
if (!isNaN(amount) && !isNaN(rate)) {
totalBalance += amount;
// Weighted interest = Amount * Rate
totalWeightedInterest += (amount * rate);
}
}
// Process all 4 rows
processRow('amount1', 'rate1');
processRow('amount2', 'rate2');
processRow('amount3', 'rate3');
processRow('amount4', 'rate4');
// Get result elements
var resultArea = document.getElementById('results-area');
var blendedRateDisplay = document.getElementById('result-blended-rate');
var totalBalanceDisplay = document.getElementById('result-total-balance');
// Calculate final blended rate
if (totalBalance > 0) {
var blendedRate = totalWeightedInterest / totalBalance;
// Show results
resultArea.style.display = 'block';
blendedRateDisplay.innerHTML = blendedRate.toFixed(3) + "%";
totalBalanceDisplay.innerHTML = "$" + totalBalance.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
} else {
resultArea.style.display = 'block';
blendedRateDisplay.innerHTML = "0.00%";
totalBalanceDisplay.innerHTML = "$0.00";
alert("Please enter at least one valid loan amount and interest rate.");
}
}
What is a Blended Rate?
A blended rate is the weighted average interest rate of multiple loans or debts. It represents the effective interest rate you pay on the total amount borrowed when you combine loans with different individual rates and balances.
This calculation is most commonly used in real estate and corporate finance. For example, if a homeowner has a primary mortgage with a low interest rate and takes out a Home Equity Line of Credit (HELOC) or a second mortgage with a higher rate, the "blended rate" tells them precisely what interest rate they are paying across the total debt load. This metric is critical when deciding whether to refinance.
How the Blended Rate Formula Works
The math behind a blended rate is a weighted average calculation. You cannot simply average the interest rates together because the loan balances (the "weights") usually differ.
The formula is:
Blended Rate = [ (Balance1 × Rate1) + (Balance2 × Rate2) + … ] / Total Balance
Example Calculation
Imagine you have two debts:
- Loan A: $200,000 at 3.0%
- Loan B: $50,000 at 7.0%
To find the blended rate:
- Multiply Balance by Rate for Loan A: 200,000 × 0.03 = 6,000 (Annual Interest)
- Multiply Balance by Rate for Loan B: 50,000 × 0.07 = 3,500 (Annual Interest)
- Sum the Annual Interest: 6,000 + 3,500 = 9,500
- Sum the Total Balance: 200,000 + 50,000 = 250,000
- Divide Total Interest by Total Balance: 9,500 / 250,000 = 0.038 or 3.8%
Even though the second loan has a high rate (7%), the blended rate (3.8%) is much closer to 3% because the bulk of the money is owed on Loan A.
How to Calculate Blended Rate in Excel
Calculating a blended rate in Excel is efficient, especially when dealing with portfolios of multiple loans. You can use the SUMPRODUCT function combined with the SUM function to achieve this in a single cell.
Step-by-Step Excel Instructions:
- Column A: List your Loan Balances (e.g., A2:A5).
- Column B: List your Interest Rates (e.g., B2:B5).
- Formula: Input the following formula in any empty cell:
=SUMPRODUCT(A2:A5, B2:B5) / SUM(A2:A5)
Breakdown of the Excel Formula:
SUMPRODUCT(Range1, Range2): This multiplies the corresponding cells in the two ranges (Balance × Rate) and adds them up. This calculates the total weighted annual interest.SUM(Range1): This adds up all the loan balances to get the total debt.- The division operator (
/) converts the total interest paid relative to the total balance into a percentage.
Why Calculate Your Blended Rate?
Understanding your blended rate is essential for financial decision-making, particularly regarding refinancing.
For instance, if current market mortgage rates are 5%, and your calculated blended rate (Mortgage + HELOC) is 3.8%, it would not make sense to consolidate your loans into a single new mortgage at 5%, as you would end up paying more interest. However, if the market rate dropped to 3.5%, consolidating would save you money.