How to use the mortgage recast calculator
- 1 Enter your current loan balance, rate and months left.
- 2 Enter the lump sum you will pay down.
- 3 Enter the lender's recast fee.
- 4 Read the new payment and compare with prepaying without a recast.
Worked example
A $300,000 balance at 6.5% with 300 months left, paying down $50,000 with a $250 recast fee. The payment falls from $2,025.62 to $1,688.02, saving $337.60 a month. Interest saved is $51,031 after the fee. Paying the $50,000 without a recast instead would keep the payment and pay the loan off 95 months sooner, saving $143,646 of interest.
Recasting a mortgage
- Ask your servicer whether it recasts and the minimum.
- Keep an emergency fund before paying down.
- Compare with prepaying without a recast.
- Check the fee and processing time.
Compare with the Refinance Calculator, plan extra payments with the Mortgage Payoff Calculator, and try the Biweekly Mortgage Calculator.
Features
New payment
Same rate and term, lower balance.
Interest saved
After the recast fee.
Recast or not
Compares with prepaying and keeping the payment.
When to use it
After selling a home
Use proceeds to lower your new payment. See them with the Home Sale Proceeds Calculator.
Keeping a low rate
A recast avoids refinancing at a higher rate. Compare with the Refinance Calculator.
Paying off early instead
See extra-payment plans with the Mortgage Payoff Calculator.
Biweekly payments
Compare with the Biweekly Mortgage Calculator.
Related Home and Auto tasks
Frequently asked questions
What is a mortgage recast?
After you make a large principal payment, the lender recalculates your monthly payment based on the new balance, keeping the same interest rate and remaining term. It is also called re-amortization.
How much does a mortgage recast cost?
Usually a flat fee of about $150 to $500, far less than refinancing, with no credit check or appraisal.
How much do I need to pay to recast?
Lenders often require a minimum lump sum, commonly $5,000 to $10,000 or a percentage of the balance.
Which loans can be recast?
Most conventional loans held by lenders that offer it. FHA, VA and USDA loans generally cannot be recast.
Recast or refinance?
A recast keeps your rate, so it suits people with a low rate who want a lower payment. A refinance can change the rate and term but costs much more.
Is it better to recast or just pay extra?
Prepaying without a recast saves more interest because you keep paying the higher amount and finish sooner. A recast gives you a lower required payment and more monthly flexibility.
Does a recast lower my interest rate?
No. The rate stays the same; only the balance and payment change.
Does a recast change my loan term?
No. The remaining term stays the same; the payment is spread over the same number of months.
Does a recast affect my credit?
No. It is not a new loan, so there is no credit check.
How long does a mortgage recast take?
Usually a few weeks to about two months after the lender receives your lump sum and request. Keep making your current payment until the new payment starts.
Can I recast more than once?
Some lenders allow several recasts over the life of the loan, often with a minimum time between them. Ask your servicer about its rules and fees.
Should I keep cash instead of paying down my mortgage?
Keep an emergency fund first. Paying down a mortgage gives a guaranteed return equal to its rate but makes the money hard to get back.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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