401(k) Loan Calculator
Calculate 401(k) loan repayment, interest paid back to yourself, and the opportunity cost of lost market returns. See the true cost of borrowing from retirement.
Partially Amortized Loan Calculator
Calculate partially amortized loan payments and balloon balance. Compare balloon dates, see amortization progress, and evaluate refinancing needs.
$
%
years
years
$
Monthly Payment⧉
$3,376.04
Based on 25-yr amortization
Balloon Payment⧉
$0.00
Due in year 10
% Amortized⧉
56853416.6%
-56853316.6% remains as balloon
Interest to Balloon⧉
$292,681.00
Paid over 10 years
Fully Amortized Alt.⧉
$5,677.40
Payment if amortized in 10yr
Payoff Progress at Balloon Date
56853416.6% paid — -56853316.6% balloon
Balloon by Term Length
| Balloon Year | Balloon Amount | % Paid Off |
|---|---|---|
| Year 3 | $0.00 | 100% |
| Year 5 | $0.00 | 100% |
| Year 7 | $0.00 | 100% |
| Year 10 | $0.00 | 100% |
| Year 12 | $0.00 | 100% |
| Year 15 | $0.00 | 100% |
Annual Schedule (to Balloon)
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | $8,255.00 | $32,257.00 | $491,745.00 |
| 2 | $8,808.00 | $31,704.00 | $482,936.00 |
| 3 | $9,398.00 | $31,114.00 | $473,538.00 |
| 4 | $10,028.00 | $30,485.00 | $463,510.00 |
| 5 | $10,699.00 | $29,813.00 | $452,811.00 |
| 6 | $11,416.00 | $29,097.00 | $441,395.00 |
| 7 | $12,180.00 | $28,332.00 | $429,215.00 |
| 8 | $12,996.00 | $27,516.00 | $416,218.00 |
| 9 | $13,867.00 | $26,646.00 | $402,352.00 |
| 10 | $14,795.00 | $25,717.00 | $387,557.00 |
Planning notes, formulas, and examples
About the Partially Amortized Loan Calculator
A partially amortized loan has payments calculated as if the loan would be paid over a longer period (the amortization period), but the full remaining balance comes due at an earlier date (the balloon date). For example, payments based on a 25-year schedule with the balance due in 10 years.
This structure is common in commercial real estate, business lending, and some residential mortgages. The borrower benefits from lower monthly payments (since they are calculated over the longer amortization period), but must plan to either refinance or pay off the balloon when it comes due.
The key risk is that only a fraction of the loan is actually repaid by the balloon date. On a $500K loan with a 25-year amortization and 10-year balloon, typically only 25-35% of principal is paid off — leaving $325K-$375K due as a lump sum. This calculator models the exact balloon amount, shows how different balloon dates affect the remaining balance, and compares against a fully amortized alternative.
When This Page Helps
Balloon structures look affordable at first because the payment is based on a long amortization period, but the refinance risk sits in the balance that remains at the balloon date. This calculator makes that tradeoff explicit by showing the remaining payoff, the share of principal retired before maturity, and how extra payments or a longer balloon term change the refinancing problem.
How to Use the Inputs
- Enter the loan amount.
- Set the interest rate.
- Choose the amortization period (payment calculation basis).
- Set the balloon due date (when remaining balance must be paid).
- Optionally add extra monthly payments to reduce the balloon.
- Review the balloon balance and percentage amortized.
- Compare different balloon dates in the scenario table.
Formula used
Monthly Payment = P × r(1+r)^n / ((1+r)^n − 1), where n = amortization months (not balloon date). Balloon Balance = P × (1+r)^b − (PMT/r) × ((1+r)^b − 1), where b = balloon month. % Amortized = (Loan − Balloon) / Loan × 100.Example Calculation
Result: Payment: $3,380/mo — Balloon: $385,125 — 23.0% amortized — $130,580 interest paid
Payments of $3,380/mo are based on a 25-year amortization, but after 10 years, $385,125 remains due as a balloon. Only 23% of the $500K principal has been paid off. A fully-amortized 10-year loan would cost $5,677/mo — 68% higher payments but no balloon risk.
Tips & Best Practices
- Plan your refinancing strategy 12-18 months before the balloon date — do not wait until the last minute.
- The longer the amortization relative to the balloon, the lower the payment but the larger the balloon percentage.
- Extra monthly payments directly reduce the balloon amount and can significantly improve your refinancing position.
- Commercial lenders typically offer 5, 7, or 10-year balloons with 20-25 year amortizations.
- Build cash reserves for the balloon — even if you plan to refinance, having a backup plan is essential.
- Compare the partial amortization payment to the full amortization payment to understand the true "cost" of lower payments.
How Partial Amortization Changes the Payment
The monthly payment is based on the full amortization schedule, not on the balloon date. That lowers the required payment compared with a fully amortizing loan over the same holding period, but it also means a large balance is still outstanding when the balloon matures.
Planning for the Balloon Date
Use the remaining-balance figure as the amount you may need to refinance, sell against, or pay from cash reserves. The closer the balloon term is to the amortization term, the smaller that balance becomes. A short balloon on a long amortization schedule creates the highest refinancing pressure.
Testing Safer Scenarios
Compare a few structures side by side: extend the balloon term, shorten the amortization period, or add an extra monthly principal payment. Even a modest extra payment can lower the future refinance amount and improve the loan-to-value position you bring to a lender.
Sources & Methodology
Last updated:
Methodology
This page first solves the monthly payment as if the loan were fully amortized over the chosen amortization period. It then stops the schedule at the earlier balloon date and computes the remaining principal balance at that point as the balloon obligation. The scenario table varies the balloon date, amortization period, or extra principal payment so users can see how those choices change the future refinance amount.
It is a balloon-loan worksheet, not a commercial-loan term sheet. Real contracts can include reset rates, extension options, reserves, or lender approval conditions that are outside this simplified calculation.
Sources
- What is a balloon payment? When is one allowed? (Consumer Financial Protection Bureau) — CFPB explanation of balloon-payment mortgages and the refinance risk created when the final balance comes due before full amortization.
- Loan Estimate (Consumer Financial Protection Bureau) — CFPB disclosure guide showing balloon features as a loan characteristic borrowers should identify and compare before closing.
Frequently Asked Questions
A loan where monthly payments are calculated over a longer period (e.g., 25 years) but the full remaining balance becomes due at an earlier date (e.g., 10 years). The borrower makes lower payments during the loan term and then must pay or refinance the remaining "balloon" balance at maturity.
It depends on the gap between amortization period and balloon date. A 30yr amort / 5yr balloon leaves ~93% of the loan unpaid. A 25yr amort / 10yr balloon leaves ~65-75% unpaid. The shorter the balloon relative to amortization, the larger the remaining balance.
Most borrowers refinance before the balloon date. If you cannot refinance (due to credit issues, property value decline, or tight lending conditions), you may need to sell the property, negotiate an extension with the lender, or face default. This is called "balloon risk."
Lower monthly payments than a fully amortized loan of the same term. This is attractive for: (1) commercial properties where the borrower plans to sell before the balloon, (2) borrowers who expect higher income in the future, (3) investment properties where cash flow matters more than principal reduction.
A partially amortized loan does pay down some principal each month — the payments include both interest and principal, just calculated over a longer schedule. An interest-only loan pays zero principal, so the entire original balance is due at maturity. Partial amortization is between full amortization and interest-only.
Usually yes — most balloon loans allow extra principal payments. The calculator shows how extra payments reduce the balloon balance. Even modest extra payments ($200-500/mo) can meaningfully reduce the balloon and improve your loan-to-value ratio for easier refinancing.
More in this topic
Amortization Calculator
Calculate loan amortization schedules showing monthly payment breakdown of principal, interest, extra payments, and remaining balance over time.
APR Calculator
Calculate the Annual Percentage Rate (APR) for any loan including fees, points, and closing costs to reveal the true cost of borrowing.