Balloon Mortgage
A mortgage loan with initially low interest payments, but that requires one large payment due upon maturity (for example, at the end of five or seven years).
Balloon Payment
The final lump sum payment due at the end of a balloon mortgage.
Bankruptcy
A federal law whereby a person’s assets are turned over to a trustee and used to pay off outstanding debts; this usually occurs when someone owes more than they have the ability to repay.
Borrower (Customer)
One who receives funds in the form of a loan with the obligation to repay the loan in full with interest. Also referred to as mortgagor.
