Posted by Bud Branstetter on December 18, 1998 at 09:43:51:
The old axiom was not to take on a balloon due under 7 years. The interest rates would drop or inflation would increase the price such that you could refi or sell. I personally prefer to negotiate in an out. A higher interest rate or some additional cash can allow an extention. You should have the resources to refi at that point. You could also use a graduated payment or interest rate to lower the payment at first and avoid the balloon.