A combination of a serial bond issue and a term bond issue. Essentially, the serial bond with balloon has bonds that mature at different intervals throughout the issue's life, and then a large percentage of the bonds (the term bonds) mature in the last year of the issue's term. Alternatively, the bulk of the bonds may mature at the first maturity date with the rest of the bonds gradually maturing over the remainder of the issue's life.  

|||All the bonds in a term issue have the same maturity date. All the bonds in a serial bond issue mature in intervals. The combination of the two creates an issue that matures at regular intervals with a large portion of the bonds maturing at the same time in the first or last interval, creating the 'balloon'.