Bullet Loan

AAA

DEFINITION of 'Bullet Loan'

Any loan that requires a balloon payment at the end of the term and anticipates that the loan will be refinanced in order to meet the balloon payment obligation.

INVESTOPEDIA EXPLAINS 'Bullet Loan'

These loans are riskier because the homeowner''s equity in the property doesn''t increase over time.

RELATED TERMS
  1. Amortization

    1. The paying off of debt in regular installments over a period ...
  2. Bullet Bond

    A debt instrument whose entire face value is paid at once on ...
  3. Bullet GIC

    A type of guaranteed investment contract where a single payment ...
  4. Bullet Repayment

    A lump sum payment for the entire loan amount paid at maturity. ...
  5. Bullet

    1) A one-time lump-sum repayment of an outstanding loan, typically ...
  6. Free Application For Federal Student ...

    The form that must be completed in order to qualify for any type ...
Related Articles
  1. The Benefits Of Mortgage Repayment
    Home & Auto

    The Benefits Of Mortgage Repayment

  2. When (And When Not) To Refinance Your ...
    Home & Auto

    When (And When Not) To Refinance Your ...

  3. What You Need To Know About Fannie Mae ...
    Investing Basics

    What You Need To Know About Fannie Mae ...

  4. Entrepreneur Vs. Small Business Owner, ...
    Investing Basics

    Entrepreneur Vs. Small Business Owner, ...

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center