Seller Financing Calculator

Seller financing lets a buyer skip a bank by paying the seller directly under a promissory note, and the two numbers that make these deals unusual are the amortization period and the balloon date, which are almost never the same length. This calculator computes a standard amortized monthly payment from the loan amount (purchase price minus down payment), interest rate, and full amortization term, then runs a month-by-month simulation for only the balloon period — tracking how much of each payment goes to interest versus principal and reducing the loan balance accordingly — to find the balance still owed when the balloon comes due. That's why a 30-year amortization with a 5-year balloon produces low monthly payments (calculated as if paid over 30 years) but leaves a very large remaining balance at year 5, since so little principal has been retired that early in an amortization schedule; this calculator surfaces that balloon balance explicitly so it isn't a surprise. If the deal is also a rental, the calculator layers on effective rent (after vacancy) minus operating expenses minus the note payment to get buyer cash flow, and separately reports the seller's yield, found by annualizing the first month's interest as a percentage of the loan amount.

Since first-month interest is just the loan balance times the monthly rate, that annualizes back to exactly the stated note rate every time — it isn't an approximation and doesn't depend on amortization term or balloon timing. Treat it as a restatement of the note rate rather than an independent measure of the seller's real return. Two things to watch: setting the balloon year equal to or beyond the amortization term returns a balloon balance of zero, since the loan is already fully paid off by then, and the total-interest figures shown are two different calculations — one for the full stated amortization, one truncated at the balloon date — so don't average them together.