Home Loans

QHow Does A Balloon Mortgage Work?
AA balloon mortgage is a short-term, fixed rate home loan with fixed monthly payments for a set number of years (usually 5-10) followed by a final payment of the principal. Payments are usually lower with a balloon mortgage because only the interest is paid each month. For example, borrowing $10,000 in a balloon mortgage means that a large payment is due in one lump sum at the end of the term. Note that if you cannot make the final payment or refinance the amount, you can lose your home.