A balloon mortgage has an interest rate that is fixed for an initial amount of time. At the end of the term, the remaining principal balance is due. At this time, the borrower has a choice to either refinance or pay off the remaining balance.
There are no penalties to paying off a balloon mortgage loan before it is due. Borrowers may refinance at any time during the life of the loan.
Balloon loans typically have either 5 or 7-year terms. For example, a 7-year balloon mortgage with an interest rate of 7.5% would feature this interest rate for the entire term. After 7 years, the remaining loan balance would become due.
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Company NMLS: 328527
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Pacific First Financial Real Estate Loans, Inc. is not acting on behalf of or at the direction of HUD/FHA or the Federal Government. This material is not from HUD or FHA and has not been approved by HUD or any government agency.
4015 Pacific Coast HWY, Suite 202
Torrance, California 90505
Phone: (310) 214-9299
marketing@pac1st.info
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