Balloon Loan Deadline Example

When applying for a mortgage to buy a home, it can be easy to lose the forest for the trees. You are so focused on getting financing, that the eventual consequences mean nothing to you. 2007 is a classic example of this. Many people started using balloon loans to get into homes that were really beyond their financial reach in 2002. Those balloon loans are now coming due, and home prices are receding. This horrific combination typically results in one ending – foreclosure. We should all learn a lesson from this.