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What Does A Balloon Payment Mean . many prospective buyers find that Vehicle Financing is the only way they'll. balloon payment plans are becoming more common among car buyers in. An increased loan size means that you will be able to afford a new or.Balloon Payment Formula A balloon payment is a lump sum paid at the end of a loan’s term that is significantly larger than all of the payments made before it. On installment loans without a balloon option, a series of fixed payments are made to pay down the loan’s balance.balloon mortgage loan The monthly payment and interest are calculated as if the mortgage or loan were being paid over this length. Also choose whether ‘Length of Amortized Interest’ is years or months. The additional amount you will pay each month (over the required ‘Monthly Payment’ amount) to pay down the principal on your loan.