Mortgage Recast Calculator

How a mortgage recast works

A mortgage recast is a re-amortization. You hand your lender a lump sum — most often from an inheritance, bonus, business sale, or proceeds from selling another property — and pay a processing fee, usually $150 to $500. The lender applies the lump sum to your outstanding principal, then recalculates what your monthly payment needs to be to pay off the (now smaller) balance over your remaining loan term, using your existing interest rate.

Three things stay the same: your interest rate, your loan term, and your loan documents. One thing changes: your monthly payment goes down. There is no credit check, no appraisal, no closing costs, no new title insurance, and no new loan.

Recast vs. refinance vs. extra payment

These three strategies all involve reducing the cost of your mortgage, but they work differently and produce very different outcomes:

The honest answer most calculators avoid: if your only goal is minimizing total interest, applying the lump sum without recasting and continuing to pay your old payment almost always wins. Recasting gives you cash flow relief — the monthly payment drops — but you give back some of the interest savings because you're stretching the smaller balance back over the full remaining term. Use the calculator above to see the exact difference for your numbers.

When a recast is the right move

Recasting is the right strategy when at least one of the following is true:

• Your current rate is lower than today's market rate (refinancing would mean a higher rate)
• You have a lump sum and want monthly cash flow relief, not faster payoff
• You sold another property and now have two mortgages, and want to lower the payment on the one you're keeping
• You inherited money and want to reduce your monthly obligations without locking up the full inheritance
• You don't qualify for a refinance (income change, credit drop, equity issues)

Recasting is the wrong strategy when current rates are well below your rate (refinance saves more), when you have no need for lower monthly payments (extra payment saves more), or when your lender won't allow it (most government-backed loans).

Which lenders allow mortgage recasting

Recasting is offered at the discretion of your loan servicer, not guaranteed by any law or regulation. Most large banks and credit unions allow recasting on conventional loans they service themselves; most online-only lenders do not. Always verify the current policy with your specific servicer before assuming you can recast.

Last verified: April 2026. Lender policies change; this table is updated quarterly.

How to request a mortgage recast

1. Confirm eligibility. Call your loan servicer (the entity you make payments to, not necessarily the original lender) and ask: "Do you offer mortgage recasting on this loan?"
2. Get the specifics. Confirm the recast fee, minimum lump sum, processing time (typically 30–60 days), and whether there's a frequency limit (most lenders cap at once per 12 months).
3. Use the calculator above to confirm the recast actually delivers what you want before you commit the lump sum.
4. Submit the lump sum. Most lenders require the lump sum to be applied to principal first, then a separate recast request. Do not just send extra money and assume it will recast — it won't.
5. Sign the recast agreement. The lender sends a one-page document confirming the new payment amount and effective date.
6. Verify the first new payment. Check the next statement for the lower payment and that all auto-pays are updated.

Frequently asked questions

What is a mortgage recast?

A mortgage recast (also called re-amortization) is when you apply a lump sum to your principal and your lender recalculates your monthly payment over the remaining loan term at the same interest rate. The term length stays the same; only the monthly payment goes down.

How much does a mortgage recast cost?

Most lenders charge a recast fee between $150 and $500. There are no closing costs, no appraisal, no credit check, and no new loan documents — unlike a refinance, which typically costs 2–6% of the loan balance.

What is the minimum lump sum?

Most lenders require a minimum lump sum of $5,000 to $10,000, with some requiring 10% of the original loan balance. The minimum varies by lender — check your servicer's recast policy before applying.

Is a recast better than a refinance?

It depends. Recast is better when your current rate is lower than today's rates, you want to avoid closing costs, and you have a lump sum. Refinance is better when current rates are meaningfully (typically 0.75%+) lower than your existing rate.

Can I recast an FHA, VA, or USDA loan?

No. Government-backed loans generally cannot be recast. Recasting is typically available only for conventional conforming loans, jumbo loans, and some portfolio loans held by the original lender.

Does recasting affect my credit score?

No. A recast does not require a credit check or hard inquiry. Your loan, term, and rate all remain the same, so it has no direct effect on your credit score.

How long does a recast take?

30 to 60 days typically. The lump sum is applied first, then the lender processes the re-amortization, sends paperwork, and the new payment takes effect on the following monthly cycle.