Last updated October 13, 2026 · Report an error
A balloon loan sets your monthly payment as if you were paying it off over a long period (like 30 years), but requires the entire remaining balance in one lump sum after a much shorter period (like 5 years) — a genuinely different structure from a fully amortizing loan.
This calculator finds your monthly payment and the exact balloon payment due at the end of the shorter term.
How it works
Enter the loan amount, rate, the amortization term used to set the payment, and the shorter term after which the balloon is due. The calculator computes the payment using the full amortization term, then finds the remaining balance at the balloon due date using the closed-form amortization-balance formula.
- Enter loan amount.
- Enter annual interest rate (%).
- Enter amortization term (months).
- Enter balloon due after (months).
- Click Calculate to see your results.
Examples
$250,000 balloon, 5-year due date
A $250,000 loan at 6%, amortized over 30 years but due in full after 5 years, has a monthly payment of about $1,498.88 and a balloon payment of about $232,635.63.
Who should use it
- Evaluating a balloon mortgage or commercial loan offer before signing.
- Planning how much needs to be saved or refinanced by a balloon due date.
Industry applications
- Commercial real estate financing
- Auto and equipment financing
Advantages
- Uses the exact closed-form remaining-balance formula rather than a rough estimate.
- Shows both the manageable monthly payment and the true balloon obligation together.
Limitations
- Doesn't model refinancing scenarios — it only reports the balance due if the loan runs to the balloon date as originally structured.
Common mistakes to avoid
- Assuming the balloon payment will be small just because years of payments have already been made — early payments are mostly interest, so the balance drops slowly.
- Not planning in advance how the balloon payment will actually be paid when it comes due.
Best practices
- Have a concrete plan (refinancing, sale proceeds, or savings) for covering the balloon payment well before its due date, not just an assumption that "something will work out."
Tips
- The shorter the balloon due date relative to the amortization term, the larger the balloon payment will be — a 5-year balloon on a 30-year amortization leaves the vast majority of the original loan still outstanding.