Final answer:
A balloon mortgage is a type of loan where the borrower pays only interest over the mortgage term and makes a balloon payment of the entire principal at the end.
Step-by-step explanation:
A loan that isn't amortized and where the borrower only pays interest over the mortgage term, with a balloon payment of the entire principal at the end, is known as a balloon mortgage. It is also sometimes referred to as a straight mortgage. In this type of loan, the borrower enjoys lower monthly payments during the term but must make a large payment at the end to pay off the remaining principal.