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Balloon Loan Calculator
Work out the monthly payment on a balloon loan and the large lump sum due at the end of the term. Enter your numbers and press Calculate.
Written by TopicDrill Editorial Team·Updated June 2026
Balance until the balloon comes due
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How the balloon loan calculator works
A balloon loan keeps payments low by basing them on a long amortization schedule, then ending the loan early with one large payment. The calculator first finds the monthly payment as if the loan ran for the full amortization period. It then amortizes month by month up to the shorter balloon term and reports the balance still owed at that point, which is your balloon payment.
The chart shows the balance slowly declining during the term. Because the payment is sized for a long schedule, the balance barely moves, which is exactly why a big lump sum remains when the balloon comes due.
A quick example
Borrow $250,000 at 6.5% with payments amortized over 30 years but a balloon due in 7 years. The payment is about $1,580 a month, yet after 7 years you still owe roughly $225,000 as a balloon, because most early payments cover interest, not principal.
Things to keep in mind
Make sure you have a clear plan to refinance or pay the balloon before it is due. For general guidance on loan terms and shopping for credit, the Consumer Financial Protection Bureau is a reliable source. Compare structures with our other free calculators.
Frequently asked questions
What is a balloon loan?
A balloon loan has low monthly payments based on a long amortization schedule, but the full remaining balance comes due as a single large payment, the balloon, after a shorter term. It is common for commercial mortgages and some auto and seller-financed loans.
How is the balloon payment calculated?
The monthly payment uses the standard amortizing loan formula spread over the long schedule, for example 30 years. The balloon is simply the loan balance still outstanding when the shorter term, for example 7 years, ends. This tool amortizes month by month to find that balance.
Why choose a balloon loan?
Balloon loans offer lower monthly payments than a fully amortizing loan of the same term, which can help with cash flow. The tradeoff is the large lump sum at the end, which usually has to be refinanced, paid off or covered by selling the asset.
What happens if I cannot pay the balloon?
You typically refinance into a new loan, sell the asset, or negotiate with the lender. Plan ahead, because if rates rise or the asset loses value, refinancing the balloon can be harder and more expensive than expected.
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