Are you thinking about getting a balloon mortgage for your Ephrates home? Balloon mortgages are not a bad option at all. However, just like any type of mortgage, you must have a clear understanding on what a balloon mortgage is.
The meaning of Balloon mortgages is hidden in the word balloon i.e. starting small at the mouth and then suddenly becoming huge. This is what happens with balloon mortgages too i.e. you start with small payments and then finally pay a big amount to pay off your home mortgage loan completely. Balloon mortgages are fixed rate mortgages for a short period (3- 10 years) and the balloon mortgage loan is generally provided by the seller to the buyer. So balloon mortgages are seller assisted mortgages where the buyer has to make very small payments for most of the tenure of loan (which is generally the interest portion only) and payoff the entire loan amount (i.e. the full principal) at the end of the loan term. This is in fact the most difficult thing with balloon mortgages, because besides making your monthly mortgage payments, you will have to channelize your investments and savings in a way that you have enough money when the final big payment arrives. However, this problem can be easily addressed by going for loan refinancing towards the end of the balloon mortgage term.
So, you can count in balloon mortgages too as an option for your Ephrates mortgage. (You can get more tips and articles on balloon mortgages from such sites online and you can even perform your mortgage calculations and get mortgage offers through same sites) |
