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Balloon Loan

A loan or bond in which the borrower makes only interest payments for a set period of time. At the end of the term, the borrower repays the entire principal at once. A balloon loan may be useful when the borrower expects interest rates to be low at the end of the term, allowing him/her simply to refinance the loan. However, there is a high risk of default because not all borrowers actually have the cash to repay an entire loan in one payment. See also: Balloon Mortgage.


The loan balance remaining at the time the loan contract calls for full repayment.

References in periodicals archive ?
The NSBF has the following three-fold mission: 1) Plan and develop facilities and provide operations service to meet the approved ballooning requirements of the scientific community.
The real "sport" of hot air and gas ballooning is in the competition.
A physician as well as an FAA examiner and ballooning instructor, Dr.
org forum is a popular online facility for discussion, advice and reviews of all aspects of hot air ballooning and already has almost 1000 members, highlighting an increased interest in ballooning in the UK.
Similar to cluster ballooning, it is a solo-piloted balloon flight.
Bank hot air balloon will stay in town all weekend to take part in the Hot Air Affair, the Midwest's premier winter ballooning event.