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Balloon Payment Calculator

Estimate the monthly payment and final balloon amount for a balloon loan, plus a side-by-side comparison with a fully amortizing loan over the same term.

Computes the monthly payment using a longer amortization basis and the balloon as the remaining balance when the term ends.

$
%
yr
yr
Monthly payment
$1,331
Pay $1,331/mo for 5 yr, then a balloon of $188,263 at term end.
Balloon at term end
$188,263
Total paid (monthly + balloon)
$268,099
Total interest
$68,099
Number of payments
60
Vs fully amortizing over 5 years
Fully amortizing monthly
$3,960
Monthly savings (balloon)
$2,630
Fully amortizing interest
$37,614

Lower monthly payments now, but the balloon is real — plan to refinance, sell, or pay the lump sum at term end.

Overview

How the Balloon Payment Calculator Works

Balloon loans keep monthly payments low by amortizing on a long schedule but ending the loan after a much shorter term — leaving a large lump-sum 'balloon' payment due at the end. This calculator computes the monthly payment, the balloon amount, and compares the structure to a fully amortizing loan of the same term so you can see exactly what the lower monthly buys and what it costs.

Formula

The Math Behind the Calculator

Monthly payment M is amortized over amortYears: M = P × r / (1 − (1 + r)^−N) where N = amortYears × 12. Balloon at term-end n months = P × (1 + r)^n − M × ((1 + r)^n − 1) / r. Total paid = M × n + balloon.

Example

A Worked Example

$200,000 at 7%, 5-year term amortized on a 30-year schedule: monthly payment ≈ $1,331, balloon at month 60 ≈ $188,260. A fully amortizing 5-year loan at 7% would be $3,960/month — much higher, but with no balloon and ~$37,500 total interest vs ~$68,000 here.

How to use

How to Use the Balloon Payment Calculator

  1. 1Enter the loan amount and the rate the lender quoted.
  2. 2Enter the term length — when the balloon is actually due (e.g. 5 or 7 years).
  3. 3Enter the amortization basis the lender uses to size the monthly payment (often 20 or 30 years).
  4. 4Compare the monthly savings to the balloon amount to decide if you can credibly refinance or sell before the balloon hits.
Interpretation

What the Results Mean

  • Monthly payment is low because most of the principal is deferred to the balloon.
  • Balloon amount is the lump sum due in full when the term ends.
  • Comparing to fully amortizing shows the monthly savings vs the lump-sum risk you're taking.
Avoid

Common Mistakes to Avoid

  • Assuming you can always refinance the balloon — rates, credit, and lender appetite may have changed.
  • Treating the balloon as far away and forgetting to budget for it from year one.
  • Comparing only the monthly payments without noting how much principal still remains at term end.
Keep going

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FAQ

Frequently Asked Questions

Why would I take a balloon loan?+

Lower monthly cash flow. Common when buyers expect to sell or refinance before the balloon comes due, or when business cash flow is currently constrained but expected to improve.

What happens if I can't pay the balloon?+

You typically have to refinance, sell the asset, or default. Refinancing isn't guaranteed — plan as if you'll need to pay it.

Is a balloon the same as an interest-only loan?+

Interest-only is the extreme case where the balloon equals the original principal. Most balloon loans amortize a little, so the balloon is smaller than the original loan.

Financial Disclaimer

This calculator is for educational and estimation purposes only. It does not provide financial, mortgage, tax, investment, or legal advice. Actual rates, payments, taxes, fees, insurance costs, eligibility, and loan terms vary by lender, location, credit profile, and market conditions. Always compare official offers and consult a qualified professional before making financial decisions.

Last updated June 2026 · Prepared by the mCalculator Editorial Team