A mortgage recast is a process in which the terms of an existing mortgage are adjusted without changing the interest rate or loan amount. Typically, a borrower makes a large lump-sum payment towards the principal balance of the mortgage, and the lender then recalculates the monthly payments based on the reduced outstanding loan amount. This results in a lower monthly payment, making it a useful option for homeowners who want to lower their monthly financial burden without the need to refinance or alter the interest rate. Mortgage recasting is different from refinancing, as it does not involve obtaining a new loan with different terms. Instead, it allows borrowers to leverage a substantial payment to modify the terms of their existing mortgage.
Free recast mortgage calculator.
You can do a mortgage recast as many times as you would like. Check with your current mortgage loan servicer for restrictions.
There is a mortgage recast fee. The cost to recast varies for each loan servicer. It is best to contact your servicer for details.
A mortgage recast lowers your monthly payment by reducing your principal balance and keeping your loan payoff date unchanged.
Government, private investors, jumbo loans and high balance loans do NOT allow recasting> Verify with your servicer for exceptions.
A written request must be summited to your servicer to recast your mortgage.