The homodyne interferometer has the advantages of simple optical configuration and low cost. However, it requires a caution in using an electronic filter such as high pass filter (HPF) to get rid of low frequency electronic noises and the dc offset associated with the optical intensity in the photodiode electronic circuitry. When the vibration amplitude is smaller than at least 12 of the wavelength of He-Ne laser, a problem of incorrect velocity or distorted velocity measurement can be caused since a dc value of the interference signal is eliminated by using the HPF. To solve this problem of using the HPF in the homodyne interferometer, a synthetic interferometer using a mechanical modulation method is proposed in this work by exciting a reference mirror with the displacement larger than 12 of the wavelength. In this work, the analytical work is presented to show how the synthetic interferometer solves the problem of incorrect velocity measurement by using the Fourier-Bessel function description of the interference signals. Simulation and experimental works are also presented to validate the synthetic heterodyne interferometer proposed in this work.