balloon mortgage
This loan has fixed monthly payments for a predetermined number of years. At the end of this term, there is one final balloon payment for the balance of the principal. This is a short-term, fixed-rate mortgage loan, typically 5, 7 or 10 years in duration. At the end of the term, some balloon mortgages give the borrower the option to refinance before the final balloon payment, but this option is not guaranteed.
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The following dictionary definition list is provided for clarification only. Note that many definitions are not directly applicable to mortgages, loans or other financial terminology in this glossary. Used with permission: WordNet 2.1 Copyright 2005 by Princeton University. All rights reserved.
balloon
Noun: balloon (small thin inflatable rubber bag with narrow neck)
Noun: balloon (large tough nonrigid bag filled with gas or heated air)
Verb: balloon (ride in a hot-air balloon) "He tried to balloon around the earth but storms forced him to land in China"
Verb: balloon, inflate, billow (become inflated) "The sails ballooned"
mortgage
Noun: mortgage (a conditional conveyance of property as security for the repayment of a loan)
Verb: mortgage (put up as security or collateral)
- balloon mortgage -
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