Balloons mortgages are for special circumstances and should only represent a small minority of outstanding mortgages. I almost employed one in 1983 when buying an apartment in Manhattan because of the super high interest rates on fixed mortgages. The balloon scared me into an adjustable rate mortgage instead and that worked out well in the end. But for people to consider balloon mortgages in the present environment of lowest fixed rates in decades is either madness or desperation. It's as if the society is so addicted to debt and credit that it would even sign on to negative interest rates just to buy more time, knowing that the balloon payment later is simply too gigiantic to pay back. Besides, everyone in reality is broke.