BYTETOOLS

Balloon Payment Calculator

Calculate the regular payment and the lump sum due at maturity on a balloon loan amortized over a longer notional term, plus total interest paid.

$1,199.10
Regular monthly payment
$186,108.80
Balloon payment due
$58,054.80
Interest paid before balloon
$258,054.80
Total paid over the loan

Balance at each year up to month 60

YearInterestPrincipalBalance
1$11,933.19$2,456.01$197,543.99
2$11,781.71$2,607.49$194,936.50
3$11,620.90$2,768.30$192,168.20
4$11,450.13$2,939.07$189,229.13
5$11,268.87$3,120.33$186,108.80

The final row is the balance that becomes the balloon payment.

Balloon loans leave a large lump sum due at the end, which usually has to be refinanced, sold into or paid in cash. Assumes a fixed rate and no prepayments. Estimates only, not financial advice.

What is the Balloon Payment Calculator?

The ByteTools Balloon Payment Calculator handles loans whose payments are sized for a long amortization but whose term ends early.

  • Regular payment sized on a long amortization, term ended early
  • Exact remaining balance at maturity, amortised payment by payment
  • Interest-only mode where the whole principal balloons
  • Shows total paid before the balloon and total interest to maturity
  • Warns when the balloon term exceeds the amortization period
  • Runs entirely in your browser with no uploads

How to use the Balloon Payment Calculator

  1. 1

    Enter the loan amount and the annual interest rate.

  2. 2

    Set the amortization period the payment should be based on, in years.

  3. 3

    Set the shorter balloon term after which the loan matures.

  4. 4

    Choose interest-only mode if the loan makes no principal payments.

  5. 5

    Read the regular payment, the balloon amount due and the total interest paid.

About the Balloon Payment Calculator

The ByteTools Balloon Payment Calculator handles loans whose payments are sized for a long amortization but whose term ends early. Enter the loan amount, rate, the amortization period the payment is based on and the shorter balloon term, and it returns the regular payment, the balloon amount due at maturity and the interest paid up to that point.

Balloon structures are common in commercial mortgages, seller financing and some car loans, because they keep the monthly payment low. The catch is the lump sum at the end, which you must refinance, sell the asset to cover, or pay in cash. Seeing that number early is the whole point of this calculator.

There is also an interest-only mode, where nothing is amortized and the entire principal balloons at maturity. All figures are computed in your browser with nothing uploaded. Estimates only, not financial advice — your contract's day-count and fee terms take precedence.

Frequently asked questions

What is a balloon payment?

It is a large lump sum due at the end of a loan whose regular payments were too small to repay the balance. The payments are calculated as if the loan ran for 30 years, but the loan matures after five or seven, leaving most of the principal outstanding.

How is a balloon payment calculated?

Take the payment for the full amortization term, then compute the remaining balance at the balloon date: B = L(1 + i)^m − P((1 + i)^m − 1) ÷ i. A $200,000 loan at 6% amortized over 30 years leaves about $186,109 due after five years.

What happens if I cannot pay the balloon?

You normally refinance into a new loan, sell the asset, or negotiate an extension with the lender. Refinancing depends on rates and your credit at that future date, which is the main risk of a balloon structure — plan for it well before maturity.

Why would anyone choose a balloon loan?

The lower payment frees up cash flow, which suits commercial borrowers expecting to sell or refinance within a few years, and buyers who expect income to rise. It is a cash-flow tool, not a way to reduce the total cost of borrowing.

How does interest-only differ from a balloon loan?

Interest-only is the extreme case: you pay only the interest, no principal at all, so the balloon equals the entire original loan amount. A conventional balloon loan pays down some principal, so the lump sum is smaller.

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