It's not! The balance is at the start of the calendar year on the form, not at the end of the year. Here's what it says in the IRS instructions for Box 2:
Moneylender reports the balance at the beginning of the day on January 1st in box 2 for existing loans, and reports the opening balance as indicated for newly created or purchased loans.Enter the amount of outstanding principal on the mortgage as of January 1, of the current year. If you originated the mortgage in the current year, enter the mortgage principal as of the date of origination. If you acquired the mortgage in the current year, enter the outstanding mortgage principal as of the date of acquisition.