How to use mortgage calculator with balloon payment?Answer:
A mortgage calculator with balloon payment is used to estimate your principal and interest payments on a balloon mortgage.
What is a balloon mortgage and how to calculate payments?
A balloon mortgage is one that has principal and interest payments scheduled over a longer period of time and the loan is actually expected to be repaid with a lump sum before the regular amortizing term. A 10/30 balloon means that the mortgage payments are calculated over 30-year term but the balloon is due in 10 years time.
To calculate your balloon payment using a mortgage calculator you will need to know at least your loan-to-value (LTV) ratio, the house price, interest rate and how the balloon home loan will be structured (5/25, 10/30, 7/23, etc.).
For example, you could take a balloon mortgage for a $240,000 home with 20% down payment over 30 years at 6.125%. The balloon payment will be due in 10 years.
Your loan amount is $192,000 and you are not paying PMI. Your monthly mortgage payment (principal and interest) will be $1,166.61 and a balloon payment of $162,376.70 will be required at the end of the 10-year balloon period.
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