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A "balloon payment" is a final, usually quite large, payment on a loan. Essentially what you're doing in such a loan is taking a (slightly) smaller monthly payment in exchange for having to come up with a large lump sum of cash at the end.
Generally speaking these aren't such a good idea for a typical borrower. The question to ask is "If I don't have the balloon payment sitting in my account right now, what reason do I have to think I will have it when it comes due?" If you can think of a very good reason (such as "By the time the balloon payment comes due my house will have sold/my bonds will have matured/I can use the money from my Certificates of Deposit without the Substantial Penalty for Early Withdrawal") then maybe the balloon payment loan does make sense. Otherwise you're probably better off avoiding them.
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What is meant by a balloon payment on a lease car?
A balloon payment refers to the last payement you make on a car that you got as a long term lease. At the end of the lease you can either make a balloon payment and buy the car, or you return the car.
What term refers to a large final payment due at the end of a loan?
Balloon Payment
What terms refers to a large final payment due to the end of a loan?
Balloon payment
Can you pay off a balloon loan early?
Yes, you can pay off a balloon loan early by making a lump sum payment of the remaining balance before the final balloon payment is due. This can help you save on interest costs and avoid potential financial risks associated with the balloon payment.
What does the concept of ballooning refer to?
A balloon payment mortgage does not fully amortize over the term of the note. Because of this, a balance is due at the time of maturity. The final payment is called a "balloon payment" because of its large size.
What terms refers to a large final payment due at the end of a loan?
Balloon Loan
Is a balloon payment calculator really a balloon?
A balloon payment calculator is not actually in the shape of a balloon. It is used to calculate a balloon payment; it is called a balloon payment because of its size.
What is meant by balloon mortgage in Anchorage, AK?
Regardless of location a balloon mortgage is when you have a large final payment at the end of the loan period.
Balloon payment you have a balloon mortgage payment and you lost your job how can you get help?
I have a balloon mortgage payment and i lost my job how can i get help
Have you ever heard of a balloon payment at the end of a purchase to buy of a used car?
Yes.
What is a balloon payment?
A balloon payment is a large, lump sum payment made either at specific intervals, or more commonly, at the end of a long-term balloon loan
What are the potential risks and benefits associated with a mortgage balloon payment?
A mortgage balloon payment can offer lower monthly payments initially but carries the risk of a large lump sum payment at the end. Benefits include lower initial costs, but risks include potential financial strain if unable to make the final payment.
