A recast re-amortizes your mortgage after a large principal payment, so the monthly payment drops while the rate and payoff date stay the same. See the new payment and compare it with simply prepaying and keeping your old payment.
Last updated:
Current mortgage
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%
months
e.g. 25 years left = 300.
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Blank = calculated from balance, rate and months.
Recast
$
Many lenders require at least $5,000–$10,000.
$
Often $150–$500.
Enter your values to see the result.
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How to use the Mortgage Recast Calculator
Enter your current balance, rate and remaining payments from your latest mortgage statement.
Optionally enter your current principal and interest payment; otherwise it is calculated.
Enter the lump sum and the lender's recast fee.
Calculate to see the new payment and monthly savings.
Compare the three scenarios in the table and chart to decide between recasting and just prepaying.
Mortgage recast formula
New payment = (B − X) × r ÷ (1 − (1 + r)−n)
B = current balance, X = lump-sum payment
r = annual rate ÷ 12 ÷ 100
n = remaining monthly payments (unchanged by a recast)
Because the payment is proportional to the balance, a recast lowers the payment by the same percentage as the balance: paying off 1/6 of the balance cuts the payment by 1/6.
Recast, prepay or do nothing
No lump sum
Recast
Lump sum, keep payment
Monthly payment
Same
Lower
Same
Payoff date
Same
Same
Earlier
Interest saved
None
Large
Largest
Fee
None
Usually $150–$500
None
Best for
Keeping cash liquid
Lower monthly costs
Becoming debt-free sooner
Tips before you recast
Keep an emergency fund. Money paid into the house is hard to get back without a loan or a sale.
Compare with your rate. If your mortgage rate is low, high-interest debt or investing may be a better use of the lump sum.
Ask the servicer for the exact process: minimum amount, fee, and whether the lump sum and recast request must be made together.
A recast (or re-amortization) is when you pay a large lump sum toward principal and the lender recalculates your monthly payment on the lower balance over the remaining term. The interest rate and the payoff date stay the same; only the payment goes down.
How is the new payment calculated?
New payment = (balance − lump sum) × r ÷ (1 − (1 + r)^−n), where r is the annual rate ÷ 12 and n is the number of remaining payments. For $300,000 at 6.5% with 300 payments left, a $50,000 recast drops the payment from about $2,025.62 to about $1,688.02.
Recast or keep paying the old payment?
Both save interest because the lump sum lowers the balance. Keeping the old payment saves more interest and pays the loan off years earlier, while a recast frees up monthly cash flow. You can recast and still pay extra later if you want.
How much does a recast cost?
Lenders typically charge a flat administrative fee, often $150 to $500, and require a minimum lump sum, commonly $5,000 or $10,000. There is no appraisal or credit check, unlike a refinance.
Which loans can be recast?
Most conventional loans backed by Fannie Mae or Freddie Mac can be recast if the servicer offers it. FHA, VA and USDA loans generally cannot be recast. Ask your servicer about its rules.
Recast vs refinance: what is the difference?
A recast keeps your existing rate and term and only lowers the payment after a lump sum. A refinance replaces the loan with a new rate and term and has closing costs. If current rates are higher than yours, a recast keeps your low rate.
Is my data sent anywhere?
No. All calculations happen in your browser.
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