About the Balloon Payment Calculator
A balloon (or residual) payment loan — common in car and equipment finance — keeps monthly repayments lower by leaving a lump sum owing at the end of the term, which you then pay out, refinance, or trade in against. This calculator works out the monthly repayment needed so the loan is fully covered by those payments plus the balloon.
How it works
It uses the standard balloon-loan formula: the repayment is set so the present value of all monthly payments, plus the present value of the balloon due at the end, equals the loan amount. A larger balloon means smaller monthly repayments, but more owing (or needing refinancing) at the end.
Assumptions and behaviour
- Assumes a fixed interest rate for the full term.
- Balloon is capped at the loan amount — you can't have a residual larger than what you borrowed.
- Models a standard principal-and-interest with residual structure, the common setup for novated leases and car loans.
Limitations
- Doesn't include establishment fees, balloon refinancing costs, or GST treatment for business finance.
- The balloon amount itself isn't a lender's guaranteed minimum — check your lender's or the ATO's minimum residual value guidelines if you're setting the balloon based on those.
Privacy
The calculation runs entirely in your browser. Nothing is uploaded or stored.
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