Get ready for the stupid question of the day. Can you make a balloon payment adjustable rate mortgage that qualifies as a QM?? Or does it have to be fixed?

If you have an ARM feature, it would seem to defeat the purpose of the need for the balloon. But, with that being said, the only way a balloon can be a QM is under the Rural/Underserved Balloon QM "program." One of the features of said program is that it has "an interest rate that does not increase over the term of the loan." So, "No," you could not have a Balloon ARM QM, unless the interest rate could only do down and not up.