What is the term for the final lump sum paid at the end of a balloon mortgage term?

The term referring to the final lump sum paid at the end of a balloon mortgage term is known as a balloon payment. A balloon mortgage typically has lower monthly payments for a specified term, but at the end of that term, the borrower is required to make a large final payment to settle the remaining balance of the loan. This payment significantly differs from regular amortized payments, as it can be substantially larger than the previous payments made throughout the loan term. Understanding this concept is crucial for borrowers considering balloon mortgages, as the size of the balloon payment can impact their financial planning significantly, making it essential to ensure they are prepared for this final payment when it comes due. Other choices, while they may sound plausible, do not accurately describe this particular financial obligation associated with balloon mortgages.