Balloon Mortgage Calculator

Enter your loan amount, interest rate, amortization term, and balloon due date to see your monthly payment and the lump sum balance due at maturity. Includes a year-by-year amortization chart and table.

Created by Luis GonzalezLast updated: June 16, 2026

How to Use This Calculator

1
Enter the Loan Amount
Input the total mortgage amount.
2
Set the Interest Rate
Enter the annual interest rate for the balloon mortgage.
3
Choose the Balloon Term
Select the period before the balloon payment is due (typically 5-7 years).
4
Set the Amortization Period
Enter the amortization schedule (usually 30 years) that determines your monthly payments.
5
Review Results
See your monthly payment, the balloon payment amount due, and total interest paid.

Example Calculation

A real estate investor purchasing a property with a 7-year balloon mortgage.

Loan Amount

$250,000

Interest Rate

5.75%

Balloon Term

7 years

Amortization

30 years

Results

Monthly payment

$1,459. Balloon payment due in 7 years: $228,400. Total interest paid during balloon period: $94,356. Total payments before balloon: $122,556.

Tips

Have an Exit Plan

Before taking a balloon mortgage, have a clear plan for how you will handle the balloon payment — sell, refinance, or pay it off.

Save for the Balloon

Set aside money each month toward the balloon payment to avoid financial shock when it comes due.

Monitor Market Conditions

If you plan to refinance, keep an eye on interest rates and your credit score as the balloon date approaches.

Negotiate a Reset Option

Some balloon mortgages include a conditional right to convert to a fixed-rate loan at the balloon date. Negotiate this provision upfront.

The Formula Behind Balloon Mortgage Calculations

Calculating a balloon mortgage involves two core formulas. First, the monthly payment is computed as if the loan will fully amortize over the entire term:

monthlyRate = annualRate / 12
totalPayments = amortizationYears x 12
monthlyPayment = loanAmount x monthlyRate x (1 + monthlyRate)^totalPayments / ((1 + monthlyRate)^totalPayments - 1)

For a $300,000 loan at 6.5% amortized over 30 years: monthlyRate = 0.065/12 = 0.005417, totalPayments = 360, and monthlyPayment = $1,896.20.

The balloon payment is the remaining balance after the balloon period. The calculator simulates each month, deducting principal (monthlyPayment - interestForMonth) from the balance. After 84 months (7 years), the remaining balance is $271,248.73 — the balloon payment due.

💡 To compare this with a fully amortizing loan, use our Mortgage Calculator to see how the same $300,000 loan pays down over 30 years with no balloon.

Example: 7-Year Balloon on a $300,000 Loan at 6.5%

Metric	Value
Monthly Payment	$1,896.20
Balloon Payment (Year 7)	$271,248.73
Total Interest (7 Years)	$130,529.88
Principal Paid Before Balloon	$28,751.27 (9.6%)
Total Cost of Loan	$430,529.88

Over 7 years, you make $159,280.80 in monthly payments (84 x $1,896.20), of which $130,529.88 is interest and only $28,751.27 reduces the principal. The balloon payment of $271,248.73 still represents 90.4% of the original loan.

How Amortization Term and Rate Shift the Numbers

The two biggest levers are the amortization term and interest rate:

15-year vs. 30-year amortization: A 15-year schedule on the same $300,000 at 6.5% raises monthly payments from $1,896.20 to $2,613.32 (+$717.12/mo), but the 7-year balloon drops from $271,248.73 to $195,224.61 — you pay off 34.9% of the loan instead of 9.6%.
5.5% vs. 7.5% rate: At 5.5%, the monthly payment is $1,703.37 and total 7-year interest is $109,530.49. At 7.5%, the payment jumps to $2,097.64 with $151,704.17 in interest — a $42,173.68 spread in total interest alone.

💡 If you're considering refinancing before the balloon comes due, our Refinance Calculator can help you compare the costs of a new fixed-rate or adjustable-rate mortgage.

Frequently Asked Questions

What is a balloon mortgage?

A balloon mortgage has lower monthly payments for a set period (typically 5-7 years), followed by a large lump-sum payment of the remaining balance. The monthly payments are usually calculated as if it were a 30-year loan, but the full balance comes due much sooner.

Who should consider a balloon mortgage?

Balloon mortgages may suit borrowers who plan to sell or refinance before the balloon payment is due, or those expecting a significant future income increase. They are common in commercial real estate. They carry significant risk if you cannot make the balloon payment.

How large is the balloon payment?

The balloon payment is the remaining principal balance at the end of the initial term. On a $300,000 loan with a 7-year balloon term and payments based on a 30-year amortization at 6%, the balloon payment would be approximately $272,000.

What happens if I cannot make the balloon payment?

If you cannot make the balloon payment, you may need to refinance the remaining balance, sell the property, or negotiate with the lender. Some balloon mortgages include a reset option that converts the loan to a fixed-rate mortgage, though this is not guaranteed.