Mortgage recasting lets you make a lump sum payment toward your principal, then the lender recalculates your monthly payment based on the new lower balance. It typically costs $200-$500. No credit check, no refinance, and your interest rate stays the same. Recasting is ideal if you have a lump sum of cash and want to lower your payment without changing your loan terms.
How Recasting Works
You make a lump sum payment toward the principal balance. The lender then reamortizes the remaining balance over the original loan term. This recalculates your monthly payment to a lower amount. Your interest rate and loan term stay the same. There is no credit check or income verification required.
Cost of Recasting
Most lenders charge a recast fee between $200 and $500. Some lenders may waive the fee for certain loan types or if you meet a minimum lump sum threshold. FHA and VA loans have specific recast rules. Conventional loans generally allow recasting. Always confirm with your lender before making the lump sum payment.
Recasting vs Refinancing
Recasting: lower monthly payment, same rate, same term, low fee, no credit check. Refinancing: new rate, new term, closing costs (2-5% of loan), credit check required. If you already have a good rate, recasting is usually better. If you want to change your rate or term, refinancing is the right choice.