Balloon Payment Loan Calculator
A balloon loan is a type of loan that does not fully amortize over its term. This means the monthly payments are lower, but a large, lump-sum payment (the "balloon") is due at the end of the loan term.
How it Works:This calculator determines your monthly payment based on a long amortization period (e.g., 30 years) but then calculates the entire remaining balance that would be due at the end of a shorter term (e.g., 7 years).
Monthly Payment (M):
$$ M = P \frac{r(1+r)^N}{(1+r)^N - 1} $$
Remaining Balance (B):
$$ B = P \frac{(1+r)^N - (1+r)^n}{(1+r)^N - 1} $$
Where:
P = Principal loan amount
r = Monthly interest rate
N = Total number of payments in full amortization period
n = Number of payments made before balloon is due
This calculator is for informational purposes and is not financial advice. Balloon loans carry significant risk if you are unable to pay the final lump sum. Consult a financial advisor before considering this type of loan.
Calculate your monthly payment and final lump-sum payment.