Welcome > Resources > Mortgage Calculators > Balloon Mortgages ...

Are Balloon Mortgages For You?

A balloon mortgage can be an excellent option for many home buyers. A balloon mortgage is usually rather short, with a term of five to seven years, but the payment is based on a term of 30 years. They often have a lower interest rate, and can be easier to qualify for than a traditional 30 year fixed mortgage. There is, however, a risk to consider. At the end of your loan term you will need to pay off your outstanding balance. This usually means you must refinance, sell your home or convert the balloon mortgage to a traditional mortgage at the current interest rates.

Definitions

Mortgage amount

Original or expected balance for your mortgage.

Interest rate

Annual interest rate for this mortgage.

Term in years

The number of years over which you will repay this loan. The most common balloon mortgage terms are 5 years and 7 years. After the mortgage term is complete, you will then need to refinance or pay off the remaining balance.

Monthly payment

Monthly principal and interest payment (PI). The monthly payment is calculated using a 30 year term.

Total payments

Total of all monthly payments over the term of the balloon mortgage. This total payment amount assumes that there are no prepayments of principal.

Total interest

Total of all interest paid over the term of the balloon mortgage. This total interest amount assumes that there are no prepayments of principal.

Prepayment type

The frequency of prepayment. The options are: none, monthly, yearly, and one-time payment.

Prepayment amount

Amount that will be prepaid on your mortgage. This amount will be applied to the mortgage principal balance, based on the prepayment type.

Start with payment

This is the payment number that your prepayments will begin with. For a one time payment, this is the payment number that the single prepayment will be included in. All prepayments of principal are assumed to be received by your lender in time to be included in the following month's interest calculation.

Savings

Total amount of interest you will save by prepaying your mortgage.

The mortgage calculators are provided by KJE Computer Solutions, LLC and made available to NUMBER1EXPERT as self-help tools for your independent use and are not intended to provide investment advice. We can't guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

"A model of how the Internet can facilitate the process of deciding where to send your children to school" - America's Best School Profiles by The Heritage Foundation Michigan Public, Private and Charter Schools: Compare them using these top-rated, comprehensive reports.   Schools in Ann Arbor, Ypsilanti and Saline

Titles >Ways to Hold Title When two or more people purchase property together, there are three ways that the title can be held. Knowing the implications of each form of ownership will help you decide how to write your deed. "Tenancy by the entireties" is reserved exclusively for married people. Both husband and wife own an undivided interest in the property. On the death of one party, the surviving spouse owns the entire property and no probate will be necessary. When unmarried persons buy a home together, they should seek legal advice regarding how title should be held. As "tenants in common" each party owns a percentage interest in the property. On the death of one party his or her interest does not go to the surviving owner but is distributed in accordance with the will of the deceased, whose estate must be probated. As "joint tenants" each party owns an undivided, equal interest that passes automatically to the surviving joint tenant. Probate is not necessary if the deed reads "joint tenants with rights of survivorship". It is important to know that in most courts, if a deed is written without specification of how title is held, the property is titled as "tenants in common." See All Tips In The "Titles" Category > See Complete Library Of Hundreds Of Tips In 30+ Categories >

Q  What 6,500 seat American theater was the location for the scene where the original 1933 King Kong breaks his chains onstage? A  The famous Shrine Auditorium in Los Angeles, built by the Shriners in 1906 to resemble an exotic Arabian mosque. See More Real Estate Trivia >

Julia Yeh The Yeh Group Edward Surovell Realtors 1898 West Stadium Boulevard Ann Arbor, MI 48103 Phone: 734-717-7609 Office: 734-761-6600 Fax: 734-661-4040 Julia@TheYehGroup.com When one of your biggest investments is at stake, don't settle for less. Experience, integrity, and service count! We take pride in getting our buyers and sellers the results they want. We educate them on the current market conditions so they can make good decisions. All our clients have had wonderful success in their real estate endeavors, and that is why our business is based on an 90% referral rate. Please feel free to contact us anytime, as we are always available to answer questions. Browse our website for special offers only our visitors benefit from. www.TheYehGroup.com is brought to you by The Yeh Group NUMBER1EXPERT™ in real estate for Ann Arbor, Ypsilanti and Saline, Michigan Read The Yeh Group's Privacy Guarantee, Terms of Service, and Free & Without Obligation Pledge

NUMBER1EXPERT™
© Best Image Marketing and/or its clients.
All rights reserved. All information deemed reliable but not guaranteed.