Balloon Payment Calculator the lump sum at the end
A balloon loan charges a payment sized against 30 years but falls due in 5 or 7. This shows both numbers: the instalment, and the balance still outstanding on the due date.
Two Terms, One Loan
The payment is amortized over one period; the loan matures over a much shorter one.
Refinancing Is Not Guaranteed
The balloon must be paid, refinanced or the asset sold — and none of those is certain in advance.
What is a balloon payment?
At a Glance
A balloon payment is the single large sum still owed when a loan matures before it has been fully repaid. The instalments are calculated as if the loan ran for a long amortization period — typically 30 years — but the contract ends much sooner, and everything left is due at once.
A balloon loan is two calculations that use different terms, and that mismatch is the entire product.
First, the payment. It comes from the ordinary annuity formula, using the long amortization period — not the short maturity:
M = P × i × (1 + i)ⁿ ÷ ((1 + i)ⁿ − 1)Second, the balance on the due date. The remaining balance after k payments has a closed form, so the balloon never depends on accumulated rounding in a month-by-month loop:
B(k) = P × (1 + i)ᵏ − M × ((1 + i)ᵏ − 1) ÷ iAccording to the Consumer Financial Protection Bureau, balloon structures are restricted on most US residential mortgages precisely because borrowers underestimate that second number. On the default figures, seven years of payments — 136,205 of cash — retire only 23,031 of principal. The rest was interest.
These are the values the calculator loads by default.
Size the payment against 30 years
6.75 % ÷ 12 = 0.5625 % per month over 360 payments gives an instalment of 1,621.50. A genuine 7-year loan of the same amount would cost 3,742.69 — more than twice as much.
Count what you actually pay in
84 payments × 1,621.50 = 136,205 handed over before the due date.
Find the balance on the due date
The closed-form identity gives 226,968.68 still outstanding — 91 % of the original 250,000.
Split what those seven years bought
250,000 − 226,968.68 = 23,031.32 of principal repaid. The other 113,174.28 was interest.
Add it all up
136,205 in instalments plus a 226,968.68 balloon is 363,174.28 to clear a 250,000 loan in seven years.
The instalment is what sells a balloon loan. The balloon is what decides whether it was a good idea.
The balloon is nearly the whole loan. After seven years on a 30-year amortization, 91 % of the original balance is still outstanding. Waiting until year 10 only brings it down to 213,253 — 85 %. A short maturity on a long amortization repays almost nothing.
Amortization period is the real lever. Keep the seven-year maturity but amortize over 20 years instead of 30, and the payment rises to 1,900.91 while the balloon falls to 197,071.20. 279 more a month cuts almost 30,000 off the lump sum.
Plan the exit before you sign. There are only three ways out: pay the balloon in cash, refinance it, or sell the asset. Refinancing depends on your credit, the asset's value and the rates available on a date years away — none of which you control. Where the exit is a sale, compare the balloon against a realistic resale value, not an optimistic one.
For a loan that repays itself in full, use the Loan Payment Calculator. To see how the balance moves payment by payment, use the Amortization Schedule Calculator.
What this estimate assumes
This calculator is for informational purposes and models a fixed-rate balloon loan with monthly compounding and no fees.
- Interest-only balloon loans differ. Some contracts require interest only until maturity, in which case the balloon is the full original amount. This page models the amortizing variety.
- Refinancing costs are excluded. Rolling a balloon into a new loan means new origination, appraisal and legal fees.
- Rates on the due date are unknown. Any plan that depends on refinancing depends on rates and lending standards years from now.
- Residual-value contracts are not the same thing. A car lease with a guaranteed buy-back sets the final sum by contract, not by amortization; this calculator derives it from the loan balance.
- Regulatory limits apply. Balloon structures are restricted on many consumer mortgages.
Verify every figure against the lender's own amortization schedule, and consult a qualified financial advisor before taking on a loan you cannot repay from income.