# Loan with Balloon Payment Calculator

Earlier we published a home loan mortgage qualification calculator and now we have created this online calculator called Loan with Balloon Payment Calculator. Let us first understand, what is a balloon payment on a mortgage? A balloon loan is a kind of loan that includes a lump sum payment schedule at any point in the term, but usually at the end of the loan. Thus, you get a balloon loan mortgage on a property where you don’t need to pay the entire principal and interest through an equated monthly payment, but you need to pay a large final payment at the end of a period or before that time? This large payment explains your question “What is a balloon payment on a mortgage? “

## Balloon Payment Mortgage Calculator

Balloon Payment Mortgage Calculator

## What is a balloon payment amortization schedule?

balloon payment amortization schedule is a periodic table for equated monthly payments for a short term and then a large lump sum payment at the end of the loan. Since balloon mortgages expect a considerable amount of money after a short time, commercial real estate loans are most of the time of the nature of balloon loan.

## The math behind loan with balloon payment calculator?

The Loan with Balloon Payment Calculator used following balloon payment formulas:

#### Monthly payment

`Pmt = (A * i * (1 + i)ⁿ) / ((1 + i)ⁿ - 1)`

Where:

• `Pmt` – monthly payment;
• `A` – Loan amount;
• `i` – periodic interest rate; and
• `n` – number of periods.

#### Balance due.

`B = (A * (1 + i)ⁿᵇ) - Pmt / i * ((1 + i)ⁿᵇ - 1)`

Where:

• `B` – Balloon payment; and
• `nb` – Number of balloon loan periods

## A balloon payment example

Here is a simple example to show how Loan with Balloon Payment Calculator works. Say you want to borrow a short term loan to finance repairing or improvement of your house, so you ask the financier for a loan that you expect to pay in 5 years. He offers you a balloon payment mortgage loan

• `Loan amount = \$500,000`;
• `Amortization period = 20 years`;
• `Balloon payment after = 5 years`; and
• `Interest rate = 6.5%`.

So, when you put aforesaid data in our balloon calculator, you see following results :

• MONTHLY PAYMENT \$3,727.87
• TOTAL MONTHLY PAYMENTS \$223,672.20
• TOTAL AMOUNT PAID \$651,618.30
• TOTAL INTEREST\$151,618.30
• BALLOON PAYMENT \$427,946

If ypou liked Loan with Balloon Payment Calculator , try our mortgage payoff calculator with payment schedule?