A loan in which the payments aren't set up to repay the loan in full by the end of the term. At the end comes the balloon payment -- one that is larger than the other, periodic payments and pays off the remaining principal.
A short-term fixed-rate loan with low payments for a set number of years and one large final balloon payment of the remainder of the principal.
A mortgage loan where the monthly payments are not large enough to repay the loan by the end of the term resulting in a lump sum due on the final payment date.
The balance of the mortgage that is due in a lump sum at a specified date in the future. Usually three, five or seven years.
A mortgage that has a substantial amount of the principal due at the maturity of the note.
a loan with a lump sum payment due for the total remaining balance at a certain date
These loans require level payments just as a 15- or 30-year fixed-rate mortgage does. But well before their maturity date (the date when they'd be paid off)- typically three to ten years after the start date-the full remaining balance of the loan becomes due and payable. Although balloon loans can save you money because they charge a lower rate of interest relative to fixed-rates loans, balloon loans are dangerous. Being able to refinance a loan in never a sure thing. Beware of balloon loans
A loan that allows borrowers to make interest only payments, or payments of some combination of interest and principal, until the loan term expires. Then the balance must either be paid off or refinanced at the end of the term.
due at a predetermined date and pays off the remaining principal.
A loan that has level monthly payments that will amortize it over a stated term but that provides for a lump sum payment to be due at the end of an earlier specified term.
A short term fixed rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract.
Also known as payment saver loan. It combines features of a lease and a conventional auto loan. Payments can be as much as 30 percent less than a conventional amortized loan, because a lease-like loan has a big balloon payment at the end. Frequently requires no down payment or security deposit. Mileage allowance is usually higher at 18,000 miles per year. At the end of the loan, the borrower may be able to sell or trade in the car and pay off the loan balance, keep the car and refinance the amount owed, or return the car to the lender as payment for the balance.
A loan that contains a provision requiring a payment, or payments, larger than the regular payments. Often the balloon payment will occur many years prior to full amortization and will be for the amount of the remaining balance of the loan.
A balloon loan is one that calls for a large sum to be paid at the end of the loan term.
A loan that must be paid off in a shorter period of tiem that it is amortized for.
A long-term loan, often a mortgage loan, which has one large payment (the balloon payment) due upon maturity of the loan. Gradual interest only payments are made prior to the lump-sum payment of principle.
Mortgage in which the remaining principal balance becomes fully due and payable at a predetermined time. Most of the time, balloon loans have level payments until the note becomes due and payable.
This type of loan is not designed to be repaid in full through periodic payments at the end of the loan term. When the term ends, a balloon payments is due. This means that one larger payment is made to pay off the remaining principal.
A long-term loan, normally a car loan, that has a lump sum payment (balloon payment) due upon maturity.
A type of payment schedule where the entire remaining principal is paid in a lump sum balloon payment.
Require level payments just as a 15-year or 30-year fixed rate loan. But well before the date they become due, the full remaining balance of the loan comes due. Though they can be economical at the outset, beware of balloon loans – you may not be able to refinance the loan.
A mortgage in which monthly installments are not large enough to repay the loan by the end of the term. As a result, the final payment due is the lump sum of the remaining principal.
A loan which consists of regular monthly payments with one large (balloon) payment at maturity. Most of these loans have a term of between 3 and 5 years.
A mortgage loan that requires the remaining principal balance be paid at a specific point in time. For example, a loan may be amortized as if it would be paid over a thirty year period, but requires that at the end of the tenth year the entire remaining balance must be paid.
When the mortgage repayment schedule is structured to end with a very large final payment. For example: a loan amortized over 30 years that is due in 7 years will have payments equal to a 30 year mortgage, but the unpaid balance of the loan will need to be paid off or refinanced at the end of 7 years.
Short term, typically 5 or 7-year loans with manageable monthly payments, but a large "balloon" payment at the end of the loan term. Good for buyer's planning to move "early". Can be refinanced.
A short-term loan with low monthly payments that are not enough to pay off the entire loan amount, so a balloon, or lump-sum payment, is due at the end of the loan term. This type of loan may have a provision to refinance when the balloon payment is due.
A type of loan that features smaller monthly payments, with the balance of the loan due in one large "balloon" payment at the end of the loan term. See next item.
A loan that has a fixed rate of interest over a period of time. At the end of the balloon period, the borrower must refinance or pay off the remaining balance.
A loan with periodic installments of principal and interest that do not fully amortize the loan. The balance of the loan is due in a lump sum at a specified date, usually at the end of the term.
A loan in with amortization and remaining balance due at the end of the loan. Also "Bullet Loan," or "Call Loan."
A fixed rate mortgage with monthly payments, which are not large enough to pay off the loan during the term. Balloons end after a specific time, usually one to five years, after which the entire remaining balance must be paid. Some programs have a refinance option at the end that gives the borrower the option to extend the loan at a new calculated fixed rate.
Any loan calling for periodic payments which will not be sufficient to repay the principal at term (maturity). The loan behaves like a fixed-rate mortgage for a set number of years(usually five or seven) and then must be paid off in full in a single "balloon" payment.
A loan that has level monthly payments amortized over a specific term (e.g., 30 years) requiring a lump sum payment of the entire principal balance at the end of a shorter term (e.g., 10 years). The final payment due at the end of the term is a balloon payment.
A mortgage in which the monthly payment is not intended to repay the entire loan. The final payment is a large lump sum of the remaining principal.