Finance
Balloon Payment
A concise definition for the California Real Estate Exam study guide.
Definition
A large lump-sum payment due at the end of a loan term. A partially amortizing loan has a balloon payment because the regular payments don't fully pay off the loan.
Why it matters on the California real estate exam
Know the definition, recognize how the term appears in a fact pattern, and compare it with related concepts before choosing an answer.
Study this topic in context
Read the related chapter for the surrounding concepts, examples, and exam tips.
Chapter 5: Finance, Mortgages & Loan Types →