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April 21, 2022 | Posted by: Jenny Ellul
What is a Balloon Mortgage?
A balloon mortgage refers to any mortgage that doesn't fully amortize over the loan term. The borrower will make payments over a set period of time which is usually five or seven years. At the end of this term the entire remaining loan balance will be due at once. As you can probably imagine, this final payment can be large, and that's why it is referred to as a 'balloon payment.'