Now you need to calculate the borrower's payments. 

Your real estate broker will calculate these for you.

To calculate them yourself, select from our  Financial calculators and check out our free financial calculator tutorial.

Or you can go directly to the payment and amortization calculator.

It is quite common to sell a property with a balloon payment. Thus the buyer makes payments to you for 3, 5 7 or perhaps 10 years say, then the remaining balance must be paid off in full. To do this they will usually have to refinance the mortgage. And hopefully by then they have a good track record of making payments to you..

It is quite simple to figure this out. You can amortize the loan over a 30 year period, but the principal outstanding in 3, 5, 7 years etc. is the amount of the balloon.

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