Balloon Mortgage Calculator

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✖Present Value of Original Balance refers to the current worth of the initial amount of money or investment at a specific point in time.ⓘ Present Value of Original Balance [PV]			+10% -10%
✖Rate of Interest per Annum refers to the annualized interest rate charged on a loan or investment over one year.ⓘ Rate of Interest per Annum [R]			+10% -10%
✖Frequency of Payments refers to how often payments are made within a specific period, such as daily, weekly, monthly, quarterly, semi-annually, or annually.ⓘ Frequency of Payments [n]			+10% -10%
✖Payment refers to the amount paid while financing an investment.ⓘ Payment [PT]			+10% -10%

✖Balloon Mortgage is a type of mortgage loan that requires the borrower to make relatively low monthly payments for a fixed period, followed by a large balloon payment at the end of the loan term.ⓘ Balloon Mortgage [BM]

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Balloon Mortgage Solution

STEP 0: Pre-Calculation Summary

Formula Used

Balloon Mortgage = Present Value of Original Balance*(1+Rate of Interest per Annum)^Frequency of Payments-Payment*((1+Rate of Interest per Annum)^Frequency of Payments-1/Rate of Interest per Annum)
BM = PV*(1+R)^n-PT*((1+R)^n-1/R)
This formula uses 5 Variables

Variables Used

Balloon Mortgage - Balloon Mortgage is a type of mortgage loan that requires the borrower to make relatively low monthly payments for a fixed period, followed by a large balloon payment at the end of the loan term.
Present Value of Original Balance - Present Value of Original Balance refers to the current worth of the initial amount of money or investment at a specific point in time.
Rate of Interest per Annum - Rate of Interest per Annum refers to the annualized interest rate charged on a loan or investment over one year.
Frequency of Payments - Frequency of Payments refers to how often payments are made within a specific period, such as daily, weekly, monthly, quarterly, semi-annually, or annually.
Payment - Payment refers to the amount paid while financing an investment.

STEP 1: Convert Input(s) to Base Unit

Present Value of Original Balance: 505 --> No Conversion Required
Rate of Interest per Annum: 0.56 --> No Conversion Required
Frequency of Payments: 12 --> No Conversion Required
Payment: 410 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

BM = PV*(1+R)^n-PT*((1+R)^n-1/R) --> 505*(1+0.56)^12-410*((1+0.56)^12-1/0.56)

Evaluating ... ...

BM = 20466.3092415285

STEP 3: Convert Result to Output's Unit

20466.3092415285 --> No Conversion Required

FINAL ANSWER

20466.3092415285 ≈ 20466.31 <-- Balloon Mortgage

(Calculation completed in 00.004 seconds)

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Balloon Mortgage Formula

LaTeX Go

What do you mean by Balloon Mortgage ?

Balloon Mortgage is a large one-time amount due at the end of a loan. This final payment is substantially larger than the regular monthly payments and typically represents the remaining principal balance of the loan. Balloon mortgages can be attractive to borrowers who expect their financial situation to improve significantly before the balloon payment becomes due, such as those expecting a substantial increase in income or planning to sell the property. They may also be suitable for borrowers who plan to refinance or sell the property before the balloon payment is due. However, balloon mortgages also carry risks, particularly if the borrower is unable to make the balloon payment when it becomes due. This could lead to financial difficulties, foreclosure, or the need to sell the property under unfavorable conditions.As with any financial decision, borrowers considering a balloon mortgage should carefully weigh the potential benefits and risks and ensure they have a clear plan for handling the balloon payment.

How to Calculate Balloon Mortgage?

Balloon Mortgage calculator uses Balloon Mortgage = Present Value of Original Balance*(1+Rate of Interest per Annum)^Frequency of Payments-Payment*((1+Rate of Interest per Annum)^Frequency of Payments-1/Rate of Interest per Annum) to calculate the Balloon Mortgage, Balloon Mortgage is a loan with low initial payments but requires the borrower to repay the balance in full in a lump sum. Balloon Mortgage is denoted by BM symbol.

How to calculate Balloon Mortgage using this online calculator? To use this online calculator for Balloon Mortgage, enter Present Value of Original Balance (PV), Rate of Interest per Annum (R), Frequency of Payments (n) & Payment (PT) and hit the calculate button. Here is how the Balloon Mortgage calculation can be explained with given input values -> 20466.31 = 505*(1+0.56)^12-410*((1+0.56)^12-1/0.56).

FAQ

What is Balloon Mortgage?

Balloon Mortgage is a loan with low initial payments but requires the borrower to repay the balance in full in a lump sum and is represented as BM = PV*(1+R)^n-PT*((1+R)^n-1/R) or Balloon Mortgage = Present Value of Original Balance*(1+Rate of Interest per Annum)^Frequency of Payments-Payment*((1+Rate of Interest per Annum)^Frequency of Payments-1/Rate of Interest per Annum). Present Value of Original Balance refers to the current worth of the initial amount of money or investment at a specific point in time, Rate of Interest per Annum refers to the annualized interest rate charged on a loan or investment over one year, Frequency of Payments refers to how often payments are made within a specific period, such as daily, weekly, monthly, quarterly, semi-annually, or annually & Payment refers to the amount paid while financing an investment.

How to calculate Balloon Mortgage?

Balloon Mortgage is a loan with low initial payments but requires the borrower to repay the balance in full in a lump sum is calculated using Balloon Mortgage = Present Value of Original Balance*(1+Rate of Interest per Annum)^Frequency of Payments-Payment*((1+Rate of Interest per Annum)^Frequency of Payments-1/Rate of Interest per Annum). To calculate Balloon Mortgage, you need Present Value of Original Balance (PV), Rate of Interest per Annum (R), Frequency of Payments (n) & Payment (PT). With our tool, you need to enter the respective value for Present Value of Original Balance, Rate of Interest per Annum, Frequency of Payments & Payment and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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