Single-payment loans are often interest-only programs, in which the total principal balance is due at the end of the term but interest payments are normally due each month. It is sometimes referred to as interest-only balloon loan programs.
Monthly interest payments on single-payment notes are treated as long-term liabilities, depending upon the loan amount and remaining term. In addition, mortgage lenders will analyze the borrower's assets to confirm his or her ability to pay the note at its scheduled maturity.
If the note will be coming due within two years and the applicant has no clear ability to repay the obligation, mortgage lenders may decline financing.
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