Loan calculator with a balloon payment
Enter your loan amount, interest rate, the amortization term used to size the monthly payment, and the year the balloon is due. The calculator shows your monthly payment, the balloon payment due at the end, total interest paid up to that point, and a full schedule.
How to use this calculator
Enter the loan amount and annual interest rate. Set the amortization term — the long schedule the monthly payment is based on (for example, 30 years). Set balloon due — the year the loan actually ends and the remaining balance comes due (for example, 7 years). Click Calculate to see your monthly payment, the balloon amount, and the schedule up to the balloon date.
How a balloon loan works
A balloon loan keeps monthly payments low by calculating them as if the loan ran for a long term — but the loan actually ends much sooner. On the balloon date, the entire remaining balance is due in one lump sum: the balloon payment.
For example, a payment might be based on a 30-year amortization, but the balloon comes due in year 7. You make 30-year-sized payments for 7 years, then owe the remaining balance all at once.
The trade-off to understand
Balloon loans offer lower monthly payments than a fully amortizing loan of the same short term, which can be useful if you plan to sell or refinance before the balloon date. The risk is the balloon itself: if you can't refinance or pay the lump sum when it's due, you could face default. Always have a clear plan for the balloon payment before taking one on.