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San Diego downtown real estate broker

Bob Schwartz, CRS, GRI 

Certified Residential Specialist



San Diego, California 92101

Telephone - Cell:
(619) 300-8819

(619) 229-0048

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Blowing Up Bills With Balloons

By Bob Schwartz, CRS, GRI İ2005 All rights reserved.

If you aren't familiar with options for financing, it is never too late to learn about them. Knowing the different terms and having the ability to relate them to each other will help you to evade situations that are not financially possible. One of the terms that you should know is "balloons". This can either aid you financially, or cause you issues. Understanding the details of how balloons work and using them to your benefit will give you the ability to pick the right loan.

Balloons are employed as means to decrease monthly payments. It does this by consolidating a particular portion of your loan each month. At the end of your entire loan, you will pay the outstanding percentage that is left. Usually, this will equal about half of the loan that you have.

You can work with balloons to your advantage if you have the correct finances in place. If you know that you will have a significant amount of money at the end of your loan term, then having a balloon can help you to save now and create your credibility with financial investments later.

If you aren't certain of your financial status and what it will be in the future, then a balloon will most likely not help you. Because you will need to pay a large amount at the end, it can push you into debt and won't help you to make an investment on another house later on. In relation to this, if you are making a particular amount now but know that you will be making more later, then you can use a balloon in order to steady your financial conditions.

By using a balloon, you will be put into a situation where your mortgage will expand to twice as much at the end of the term. This can be a benefit or a disadvantage, depending on your situation. By understanding precisely how to seal the end of the balloon, you will be able to choose the best financial options for your situation.



Bob Schwartz, is a Certified Residential Specialist, CA licensed real estate broker with Bob has over 27 years of residential real estate experience, authored a number of published articles and served as an expert witness for San Diego lawyers. You can contact Bob via e-mail at or visit his highly popular San Diego real estate website at:
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