Balloon or No Balloon?
Firstly, what is a Balloon (also known as a Residual)?: A Balloon is a one off amount to be paid to the Lender at the end of your Loan or Lease on your vehicle or equipment.
Benefit: A Balloon can help reduce your monthly Loan or Lease payments for cash flow benefits.
Downfall: At the end of your Loan or Lease, you need to pay the Balloon in full. You can also look at refinancing the Balloon at the end of the term (before it is due to be paid). If you take out a large Balloon be careful that the Balloon will not end up higher than the value of your car or equipment, particularly if you are looking to sell or refinance.
If you can afford the repayments you can choose not to have a Balloon and make the repayments so the car or equipment is paid out at the end of the term.
Call Pearl Finance & Investments for your finance options 07 3812 3430 or or go to our contact page to make and enquiry.
If you found this finance tip helpful, please like our page and share our posts.
Benefit: A Balloon can help reduce your monthly Loan or Lease payments for cash flow benefits.
Downfall: At the end of your Loan or Lease, you need to pay the Balloon in full. You can also look at refinancing the Balloon at the end of the term (before it is due to be paid). If you take out a large Balloon be careful that the Balloon will not end up higher than the value of your car or equipment, particularly if you are looking to sell or refinance.
If you can afford the repayments you can choose not to have a Balloon and make the repayments so the car or equipment is paid out at the end of the term.
Call Pearl Finance & Investments for your finance options 07 3812 3430 or or go to our contact page to make and enquiry.
If you found this finance tip helpful, please like our page and share our posts.
