Financing · United States

Mortgage Recast Calculator

See what a lump sum does to your monthly payment — and what that choice costs you against simply paying the same money in and leaving your payment alone.

The short answer

A recast re-amortizes your remaining balance over your remaining term after a lump-sum payment, which lowers your monthly payment. Your rate, your term and your payoff date all stay the same, and there is no requalification — just a servicer fee, usually a few hundred dollars. The catch: recasting saves you less total interest than paying the same lump sum and leaving your payment alone. It buys cash flow, not savings.

Your loan

Payment today: —
Balance after lump sum: —

Payment after recast—

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The same lump sum, two ways

Recast

Lower payment

Monthly payment: —
Paid off in: —
Total interest: —

Keep paying the same

Less interest

Monthly payment: —
Paid off in: —
Total interest: —

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This is an estimate

These figures cover principal and interest only — your actual bill also carries escrow for taxes and insurance, which a recast does not change. Servicer fees, minimum lump sums and eligibility all vary. Confirm the numbers with your servicer before moving money. Nothing here is financial or legal advice.

The detail

Recasting buys cash flow, not savings

This is the part most recast calculators leave out. Putting a lump sum against your principal saves you interest either way — but recasting saves you less of it than doing nothing else at all.

The reason is straightforward once you see it. If you hand over the money and keep paying what you pay now, every dollar above the newly-reduced interest goes to principal, and the loan collapses years ahead of schedule. If you recast, the lender stretches that smaller balance back across the full remaining term, so you pay less each month but you pay for longer. The lump sum is the same. What differs is whether you spend the benefit on monthly breathing room or on finishing early.

Neither is wrong. If a lower payment is what makes your budget work — a new baby, a single income, a move to part-time — that flexibility is worth real money, and a recast delivers it for a few hundred dollars in fees rather than the several thousand a refinance would cost. Just make the trade knowingly.

Three worked examples

What the trade-off looks like in dollars

The same lump sum, three situations. In every one, recasting lowers the payment and costs more interest than paying the money in and leaving the payment alone. The size of that gap is the whole decision.

Scenario	Payment now	After recast	Saved / mo	Instead, paid off in	Extra interest
Modest lump sum, early in the loan$300,000 at 6%, 28 yr left, $25,000 lump sum	$1,845	$1,692	$154	22 yr 11 mo	$62,622
Windfall at the midpoint$250,000 at 5.5%, 20 yr left, $50,000 lump sum	$1,720	$1,376	$344	13 yr 11 mo	$43,808
Large lump sum, low legacy rate$420,000 at 3.25%, 24 yr left, $100,000 lump sum	$2,102	$1,602	$501	16 yr 5 mo	$48,178

"Instead, paid off in" is what the remaining term becomes if you pay the lump sum and keep your current payment rather than recasting — the recast leaves the term untouched. Servicer fees are excluded; they are a few hundred dollars either way and do not change which option wins. Run your own figures in the calculator above, and see how we calculate this.

Before you call your servicer

What to know about recasting

What is a mortgage recast?

You pay a lump sum against principal, and your lender re-amortizes the remaining balance across the term you have left, at the rate you already have. The result is a smaller monthly payment. Your rate does not change, your payoff date does not change, and you do not requalify — there is no credit check, no appraisal, and no closing costs beyond a modest processing fee.

Mortgage recast vs refinance: what is the difference?

A refinance replaces your loan. You get a new rate, a new term, and a new set of closing costs, and you have to qualify all over again. That makes refinancing the right move when rates have fallen far enough to pay back those costs. A recast changes nothing about the loan except the size of the payment, which makes it the cheaper option when your rate is already competitive and what you actually want is breathing room in the monthly budget.

Mortgage recast vs principal payment: which saves more?

Paying a lump sum without recasting leaves your payment exactly where it is. Because more of each payment then goes to principal, the loan clears years earlier and you pay far less interest overall. Recasting takes the same lump sum and spends the benefit on a lower payment instead. Both are reasonable; they simply buy different things, and the calculator above shows what each one costs.

Which loans can you recast?

Recasting is generally available on conventional loans held or backed by Fannie Mae and Freddie Mac. Government-backed loans — FHA, VA and USDA — generally cannot be recast, though refinancing into a conventional loan first is sometimes a route. Jumbo loans vary by lender. Nothing obliges a servicer to offer recasting at all, so confirm before you commit the money.

Source: Fannie Mae Servicing Guide C-1.2-01, Processing Additional Principal Payments

How much does it cost to recast a mortgage?

Servicers typically charge a flat processing fee, often somewhere between $150 and $500, and set a minimum lump sum before they will recast. Some also cap how many times you may do it over the life of the loan. These are servicer policies rather than regulations, so they vary — ask yours directly rather than relying on a figure you read anywhere, including here.

How do you recast a mortgage?

Contact your servicer and ask specifically for a recast, or re-amortization. Confusion with refinancing is common on both sides of that call, so be explicit that you are not seeking a new loan. Expect to send the lump sum and a written request, and allow a billing cycle or two before the lower payment takes effect. Keep paying the old amount until they confirm in writing.

Also asked

Common questions about recasting

Is a mortgage recast worth it?

It is worth it when you want a lower monthly payment and your current rate is one you would not want to give up. That is the whole case, and it is a good one: a few hundred dollars in fees buys a permanently smaller bill, with no requalification and no closing costs. It is not worth it if what you actually want is to pay less interest overall or to be done sooner — paying the same lump sum and leaving your payment alone beats a recast on both counts, every time, for free.

Does a mortgage recast lower your interest rate?

No. A recast cannot change your rate under any circumstances — it re-amortizes the balance you have at the rate you already hold. Only a refinance changes a rate, and it does so by replacing the loan entirely, with new closing costs and a fresh qualification. If a servicer representative implies otherwise, they have misunderstood which product you are asking about, which happens often enough to be worth naming on the call.

Does a mortgage recast hurt your credit?

No. There is no credit inquiry, no new account, and no closing of an old one, because no new loan is created — the existing loan simply has its payment recalculated. This is one of the practical advantages over refinancing, which involves a hard inquiry and a new tradeline.

How long does a mortgage recast take?

Typically one to two billing cycles after the servicer receives the lump sum and the written request. Keep paying your existing amount until you have written confirmation of the new one. Paying the lower figure early, before the recast is processed, produces a shortfall that can be reported as a missed payment.

How many times can you recast a mortgage?

Sometimes — and how often you may do it is set by your servicer rather than by any rule. Servicers commonly cap the number of recasts over the life of a loan, and each one carries its own fee and its own minimum lump sum. These are servicer policies rather than regulations, so the only reliable answer is the one your own servicer gives you in writing.

Recast and refinance, defined side by side →

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