Mortgage Recast Calculator
Calculate your new, lower monthly mortgage payment after applying a lump-sum payment toward principal, keeping the same rate and remaining term.
$
%
years
$
New Monthly Payment
$1,739.61
Old Monthly Payment
$1,932.90
New Balance After Lump Sum
$270,000.00
Monthly Savings
$193.29
How Mortgage Recasting Works
Recasting a mortgage means making a lump-sum payment toward your principal, then having your lender re-amortize the loan over the same remaining term at the same interest rate — resulting in a lower monthly payment. This is different from refinancing, which replaces the loan entirely and can involve a new rate, new term, and full underwriting. Recasting typically keeps your existing loan and rate intact, and usually comes with a small one-time lender fee (often a few hundred dollars) instead of full closing costs.
New Payment = New Balance amortized at the same rate over the same remaining term
Example
A $300,000 balance at 6% with 25 years remaining currently costs about $1,932.90 a month. Applying a $30,000 lump sum drops the balance to $270,000.00, which re-amortizes to about $1,739.61 a month at the same rate and term — a savings of roughly $193.29 every month going forward.
Common Use Cases
- Lowering monthly payments after receiving a bonus, inheritance, or home sale proceeds.
- Reducing payments without the closing costs and paperwork of a full refinance.
- Keeping a favorable existing interest rate while still lowering monthly cash outflow.
- Deciding between recasting, refinancing, or simply making extra principal payments.
FAQs
How is recasting different from refinancing?
Refinancing replaces your loan with a brand-new one, which can change your rate and term and typically requires a credit check, appraisal, and full closing costs. Recasting keeps your original loan, rate, and term — it simply recalculates your payment based on a lower balance after a lump-sum payment, usually for a modest flat fee.
Does recasting shorten my loan term?
No — recasting keeps the same remaining term but lowers the monthly payment. If you want to pay off the loan faster while keeping the same payment, making extra principal payments without recasting (or refinancing to a shorter term) accomplishes that instead.
Is every mortgage eligible for recasting?
Not always — recasting availability and rules (minimum lump-sum amount, fees, eligible loan types) vary by lender and loan type. Government-backed loans like FHA or VA loans often don't allow recasting. Check with your loan servicer to confirm eligibility.