BALLOON PAYMENT MORTGAGE

In the recent year, there has been an avalanche of housing foreclosure. One of the various reasons is the balloon payment mortgage. A balloon payment can trigger a foreclosure when they come due if the owner does not have the ability to refinance the property or pay off the debt. The value of the property may have deteriorated; interest rates might be too high for the owner to qualify for another loan; the owner might not be able to afford it. If the property has not appreciated as expected, the owner must sell or face foreclosure. Most prospective sellers wait until the last possible date, when it is too late, and they are foreclosed upon.