Homeowners often wonder if there’s a way to reduce their monthly mortgage payments without refinancing or extending their loan. The answer? A mortgage recast, and our Recast Calculator makes it easier than ever to calculate your savings.
Mortgage Recast Calculator
📘 What Is a Mortgage Recast?
A mortgage recast (also known as reamortization) is when your lender recalculates your mortgage payment based on a reduced loan balance after a large lump-sum payment.
You keep your original loan term and interest rate, but your monthly payment goes down, because you’re now paying interest on a smaller principal.
🔑 Benefits of Recasting a Mortgage:
- ✔️ Lower monthly mortgage payments
- ✔️ Avoid refinancing costs
- ✔️ No credit check or income verification
- ✔️ Keep your original loan terms and interest rate
- ✔️ Save thousands in long-term interest
🧮 What Is the Recast Calculator?
Our Recast Calculator is a smart tool that allows homeowners to simulate what their mortgage will look like after a lump-sum principal payment. It gives you insights into:
- ✅ Your new monthly payment
- ✅ Interest savings
- ✅ Adjusted amortization schedule
- ✅ Total savings over the life of the loan
🛠️ How to Use the Mortgage Recast Calculator
✅ Step-by-Step Instructions:
- Enter your original loan amount
(e.g., $350,000) - Input loan term and interest rate
Common terms include 15 or 30 years, with fixed interest rates. - Enter current remaining balance
This is how much you still owe on the mortgage. - Input remaining term in years/months
You can check this from your lender or amortization schedule. - Enter lump-sum payment amount
The amount you want to apply to your mortgage. - Click "Calculate"
The calculator instantly shows:- New monthly mortgage payment
- Interest savings
- Updated total payments
- Effective changes in your amortization timeline
📐 Recast Mortgage Formulas (Plain Text)
1. New Principal After Lump-Sum
New Principal = Current Balance – Lump-Sum Payment
2. New Monthly Payment (Amortized)
P = [r × New Principal] / [1 – (1 + r)^–n]
Where:
- P = New monthly payment
- r = Monthly interest rate (annual ÷ 12)
- n = Number of months remaining
3. Interest Saved
Interest Saved = Original Interest – New Interest Over Loan Term
📊 Example Scenario
Imagine:
- Original Loan: $300,000
- Interest Rate: 4.5%
- Term: 30 years
- Remaining Loan Balance: $250,000
- Remaining Term: 25 years
- Lump-Sum Payment: $50,000
Without Recast:
- Monthly Payment = $1,267
After Lump-Sum Recast:
- New Principal = $200,000
- New Monthly Payment = $1,013
- Monthly Savings = $254
- Interest Saved over the term = $22,000+
🔁 Recast vs Refinance
| Feature | Recast | Refinance |
|---|---|---|
| Interest Rate Change | ❌ No | ✅ Yes |
| New Credit Check | ❌ No | ✅ Yes |
| Monthly Payment Drop | ✅ Yes | ✅ Yes |
| Costs | 💵 $150–$500 | 💵 $3,000–$7,000 |
| Loan Term Reset | ❌ No | ✅ Yes (optional) |
| Ideal For | Extra cash, keep current rate | Lowering rate or cash-out |
🧠 When Should You Recast?
- After receiving a windfall, bonus, or inheritance
- When you sell a second property
- To reduce monthly payments without restarting your loan
- When refinancing is too costly or risky
- To improve cash flow while keeping your interest rate
⚠️ Things to Consider Before Recasting
- Not all lenders allow recasting (check with your bank)
- Minimum lump-sum usually required (e.g., $5,000 or more)
- Not available on FHA, USDA, or VA loans
- Doesn’t shorten your loan unless you keep paying the same amount
🔍 Additional Benefits
- Helps with budgeting and financial planning
- Boosts equity faster (if no recast, lump-sum still reduces interest)
- Great option for those planning to stay long-term in the home
✅ 20 Frequently Asked Questions (FAQs)
1. What is a mortgage recast?
A recalculation of your mortgage payment based on a lower loan balance after a lump-sum payment.
2. Does recasting change your loan term?
No. Your original term stays the same; only the payment changes.
3. Is recasting better than refinancing?
It depends. Recasting is cheaper and keeps your interest rate. Refinancing helps if you want a lower rate or shorter term.
4. Is there a fee to recast a mortgage?
Yes. Typically between $150–$500, depending on the lender.
5. Can I recast multiple times?
Some lenders allow it, but often only once. Check your agreement.
6. Can you recast a fixed-rate mortgage?
Yes, fixed-rate loans are most commonly eligible.
7. Can I recast an FHA or VA loan?
Usually not. Government-backed loans typically don’t allow recasting.
8. Is a credit check required?
No credit check is needed for a mortgage recast.
9. Does a recast hurt your credit?
No. It doesn’t appear on your credit report.
10. Can you recast after an extra payment?
Yes, if the lump-sum meets the lender’s minimum requirements.
11. Does recasting reduce interest?
Yes. You pay less interest overall because your balance is lower.
12. Can I continue paying my original monthly amount?
Yes! This will pay off your mortgage faster.
13. What happens if I sell the home later?
You’ll have built more equity and paid less interest, benefiting you at resale.
14. Can I recast a rental or second home mortgage?
Some lenders allow this—check with yours directly.
15. How much should I pay to make a recast worthwhile?
Usually $5,000 or more. The larger the lump sum, the greater the benefit.
16. What’s the best time to recast?
Early in your mortgage term, when interest is highest.
17. Does the recast calculator consider escrow payments?
No. Escrow for taxes and insurance remains unchanged.
18. Can I recast if I’m behind on payments?
Usually not. Your loan must be in good standing.
19. Does recasting reduce my interest rate?
No. It keeps your original interest rate.
20. Is this Recast Calculator free to use?
Yes! It’s 100% free and works instantly on any device.
🧾 Final Thoughts
Our Mortgage Recast Calculator is a fast, accurate way to understand how a lump-sum payment can improve your financial outlook. Recasting is a powerful financial tool that lowers your monthly burden while helping you save on interest—without the hassle of refinancing.