Balloon Payment Due
$905,621.63
Commercial Loan Calculator
Calculate payments for a commercial loan with a balloon payment structure.
Monthly Payment
$6,752.07
At End of (Years)
5
Interest Paid Before Balloon
$310,745.93
Amortization Period
25 yrs
How to use the Commercial Loan Calculator
The Commercial Loan Calculator is free and runs entirely in your browser — no sign-up, and nothing you enter leaves your device. It opens pre-filled with a realistic example, so you can see how it works before replacing any figure with your own; the results update as you type. Press Calculate to refresh the result panel, or Reset to return to the example.
The inputs it asks for:
- Loan Amount — a dollar amount.
- Annual Interest Rate — a percentage (enter 6 for 6%).
- Amortization Period (yrs) — a number.
- Balloon / Loan Term (yrs) — a number.
The formula
A commercial loan often amortizes on a long schedule but comes due early with a lump-sum balloon. It sizes the monthly payment from the full amortization period, then reads off the balance still owed at the balloon date:
Payment = amortize(amount, rate, amortization years)
Balloon due = balance remaining at the balloon year- Amortization years
- the (longer) schedule the payment is based on, e.g. 25
- Balloon year
- when the remaining balance falls due in one payment, e.g. 5
Because the payment is stretched over a long amortization but the loan matures early, only a fraction of the principal is repaid before the balloon — so the balloon can be a large share of the original loan, usually refinanced or paid from a sale.
Worked example
Using the example values — Loan Amount $1,000,000.00, Annual Interest Rate 6.5%, Amortization Period (yrs) 25, Balloon / Loan Term (yrs) 5 — the Commercial Loan Calculator returns a Monthly Payment of $6,752.07. It also reports Balloon Payment Due ($905,621.63), At End of (Years) (5), Interest Paid Before Balloon ($310,745.93).
Prefer your own numbers? Change any field above and this recomputes instantly.
Key terms
- Balloon payment
- A large lump sum of remaining principal due at the end of the loan's term.
- Amortization period
- The longer schedule used to size the monthly payment.
- Loan term / balloon year
- When the balance actually comes due.
Frequently asked questions
Why is the balloon so large?
Because the payment is based on a long amortization (say 25 years) while the loan matures early (say 5). Little principal is repaid in between, so most of the balance remains — that's the balloon.
How is a balloon repaid?
Usually by refinancing into a new loan, or from the sale of the property. It relies on credit or asset value being available at maturity, which is the main risk.
Is this how home mortgages work?
No — standard residential mortgages fully amortize over their term with no balloon. Balloons are common in commercial and some short-term financing.