The Dottie & Kate Team
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Balloon Mortgage

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Balloon mortgages are typically short-term loans with a low interest rate. However, what makes these loans different than others is that the last payment is much larger than the others. Often, that final payment is at least twice as large as the regular monthly payments.

Though this may be a convenient choice at the moment you are considering buying a home, it can be disastrous if plans do not work out like you assumed they would.

Balloon mortgages are often used by young, first-time homeowners. The low monthly payments allow them to get on their feet as homeowners and build up a good financial foundation, while still having a house to their name. The assumption is that, by the time that final payment comes, they will have advanced far enough in their career or otherwise had enough time to save up enough money to pay off the loan. 

If that plan does not work out, some homeowners will attempt to sell their house or refinance to avoid defaulting on their balloon mortgage. However, if the value of the property has fallen, or the borrower’s finances are in such a state that refinancing is not an option, the bank may repossess the house. 

​Unless a borrower is absolutely certain they will be able to pay off the final balloon note, it is usually advised to choose a different kind of mortgage. If you are unsure what kind of loan is best for your situation, an experienced real estate agent may be able to provide some advice.
Dottie Toney                                                                                                                                                                                                                       Kate Swarthout
Keller Williams Realty                                                                                                                                                                                       Keller Williams Realty

Cell:
770-715-0512                                                                                                                                                                                                        Cell: 770-715-0612
Email: dottietoney@kw.com                                                                                                                                                                      Email: kateanne@kw.com
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  • Home
  • Find a home
  • Featured Properties
    • 225 Late Rise Rd
    • 120 Friddell Rd
    • 1600 A Hwy 81
    • 1809 Stark Rd
    • 13759 Woolsey Rd
    • 225 Tussahaw Ln
    • 469 Parker Rd
    • 267 McDonough Rd
    • 1600 B Hwy 81
    • 115 June Court
    • 332 Roberts Point Road
    • 7625 Wright Circle
    • 695 Moreland Road
    • 2551 Hidden Hills Drive
    • 110 Walnut Ridge Way
    • 108 Greenland Drive
    • 29 Highland Circle
    • 521 Blue Cedar Court
    • 779 Crumbley Road
    • 2933 Old Snapping Shoals
    • 171 W Nuthatch Drive
    • 1809 Stark Rd
    • 118 Bell Road
  • Home Staging
  • RESOURCES
    • Blog
    • Selling Tips
    • Locations
    • FAQ
    • Real Estate Glossary
  • Contact