| |
|
|
|
Balloon Mortgages |
Green Valley Mortgage offers Long Island New York Balloon Mortgages available as a 7 year
loan which has a lower initial monthly payment, or a 5
year loan which offers lower payments over a shorter
period of time. There is a risk of rates being higher at
the end of the initial fixed period, and a risk of
foreclosure if you cannot make balloon payments, or if
you cannot refinance, or if you cannot exercise the
conversion option. Many balloon mortgages offer the
option to convert to a new loan after the initial term.
A partial amortization or balloon loan is one where the
amount of monthly payments due are calculated
(amortized) over a certain term, but the outstanding
principal balance is due at some point short of that
term. This payment is sometimes referred to as a
"balloon payment". A balloon loan can be either a Fixed
or Adjustable in terms of the Interest Rate. Many Second
Trust mortgages use this feature. The most common way of
describing a balloon loan uses the terminology X due in
Y, where X is the number of years over which the loan is
amortized, and Y is the year in which the principal
balance is due. A contract could be written up so there
would be more than one "ballon payment" required to be
paid during the life of the loan. |
|
 |
|
