balloon payments
End-heavy loan settlements
Balloon payments are large lump-sum payments due at the end of a loan, after a series of smaller regular payments.
A balloon mortgage might have low monthly payments for five years, then require the remaining balance—often most of the principal—all at once.
The structure makes early payments affordable but creates risk: borrowers must refinance, sell, or come up with substantial cash when the balloon comes due.
They lost the house when they couldn't make the balloon payment.
- loanBorrowed money repaid later
- car loanBorrowed money for wheels
- amortizationGradual debt reduction schedule
- interestAttention, stake, or fee
- interest onlyPayments covering charges alone
maturity · principal · finance · lending · predatory lending · debt · lump sum · adjustable-rate mortgages · mortgage · creditor · fine print · home equity · housing bubble · reverse mortgages · debt-to-income ratio · teaser rates · foreclosure · secured loans
- mortgagesfixed-rate mortgage, mortgage broker, adjustable-rate mortgage, mortgage insurance, mortgage deed
- housing crisishousing bubble, housing crash, subprime mortgages, foreclosures, subprime loans
- payday loanspayday loan, payday loans, cash advance, rollover, fee
- predatory lendingpayday loans, title loans, loan sharks, loan sharking, usury
- loansloan, loans, lend, borrow, auto loans
- lendingloans, borrower, approval, lenders, bank loan
balloon, payment, balloons, ballooning, ballooned, payments, paying, payable, payer