Balloon mortgages are so named because the entire balance becomes due in full at a predetermined date. At that time, the payment on the note suddenly expands or balloons. This can be a disadvantage if you don't have the funds available, or can't refinance the mortgage. On the plus side, however, balloon loans offer lower monthly payments, which is their main appeal.
The government takeover of Fannie Mae and Freddie Mac could potentially increase your tax bill down the road. It can also mean it's a good time to refinance.
Coming up with a 20 percent down payment on a home can be difficult, especially for first-time homebuyers who don't have the equity that existing homeowners may have when selling one home so they can buy a bigger one.