Balloon Mortgage

Pros
This is a fixed-rate mortgage with a twist: It has regular monthly payments like a traditional mortgage, but requires large lump-sum payments (the balloon) at regularly scheduled intervals throughout the loan’s term. Usually, these lump sum payments are required at the three-, five-, seven-, 10 or 15-year anniversary of the loan.

Balloon mortgages typically offer a lower initial interest rate compared to 30-year fixed rate mortgages, so borrowers may qualify for a higher mortgage amount. At the end of the loan period, the borrower must then pay off the remaining balance on the loan or refinance it into another loan product.

Cons
When a lump-sum payment is due, you might have to pay off the remaining balance of the loan all at once. In this scenario, if you have a high loan amount, but a short term, you might have to pay an amount nearly equal to or more than what you have already paid on the loan. 

If you choose to refinance the remaining balance, you run the risk of not remaining eligible for another loan. Even if you can refinance the remaining balance, the majority of your monthly payments will initially go towards interest, and you will lose any equity you had in the property.