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Calculator Answers

Mortgage Recast Calculator

Blake Boege
Written by Blake Boege · Founder, Calculator Answers

A mortgage recast calculator is a financial utility that estimates the reduction in monthly payments after recasting a home loan. Recasting, or re-amortization, occurs when a borrower pays a lump sum toward the principal balance, and the lender recalculates the remaining monthly payments based on the original interest rate and term. The calculator processes the current loan balance, interest rate, remaining term, and lump-sum payment. Homeowners use this tool to compare monthly savings from recasting against other refinancing or investment options.

Enter your current loan balance, interest rate, remaining term, and the lump-sum principal payment. The calculator returns the new monthly payment, monthly savings, and lifetime interest savings.

See also: Mortgage Refinance Calculator, Mortgage Calculator, and Reverse Mortgage Calculator.

Quick Answer

Calculate the impact of recasting your mortgage. Enter your loan details and lump-sum payment to find your new monthly savings.

$

Principal remaining on the mortgage today. · e.g. 280,000

%

Annual rate on the existing loan; a recast keeps your rate. · e.g. 6.5

yr

Years left on the original amortization. · e.g. 27

$

Most servicers require a minimum (often $5,000 to $10,000) and charge a small recast fee. · e.g. 30,000

What is a recast?

A mortgage recast (re-amortization) drops a lump-sum payment against the principal and re-amortizes the loan over the same remaining term and at the same rate. Monthly payment goes down; payoff date does not change. Unlike a refinance, recasts do not require an appraisal, closing costs, or a new loan.

Not lending or financial advice. Confirm with your loan servicer whether recasting is allowed, the minimum lump sum, the recast fee, and any waiting period.

Recast estimate

New monthly P&I

$1,638.89

Was $1,835.55 · saves $196.67 per month

Current balance$280,000.00
Lump-sum principal payment$30,000.00
New balance$250,000.00
Old monthly payment$1,835.55
New monthly payment$1,638.89
Monthly savings$196.67
Old total interest (remaining term)$314,719.47
New total interest (remaining term)$280,999.53
Estimated lifetime interest savings$33,719.94

P&I (principal and interest) only. Taxes, insurance, PMI, and HOA dues are unchanged by a recast. Servicer fees and minimum lump-sum requirements vary; estimate ignores them.

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Examples

$280,000 · 6.5% · 27 yrs · +$30,000 recast

Was $1,890/mo, now $1,688 · saves $202/mo

$200,000 · 7% · 28 yrs · +$25,000 recast

Was $1,338, now $1,171 · saves $167/mo

$400,000 · 5% · 25 yrs · +$50,000 recast

Was $2,338, now $2,046 · saves $292/mo

$150,000 · 4% · 20 yrs · +$20,000 recast

Was $909, now $788 · saves $121/mo

How it works

A recast re-amortizes your loan over the same remaining term at the same rate. The math is identical to the original mortgage payment formula, just with the new (smaller) principal balance.

New balance · balance − lump_sum

Payment · P × r × (1+r)^n / ((1+r)^n − 1)

Total interest · payment × months − principal

P = principal, r = monthly rate (annual rate / 12 / 100), n = remaining months on the original schedule.

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Disclaimer. Lending estimate only. Servicer recast policies, minimum lump-sum amounts, fees, and eligibility (FHA, VA, USDA loans typically cannot be recast) vary. Confirm with your loan servicer before sending money. Not legal, lending, or financial advice.

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Frequently asked questions

A recast (re-amortization) is when you apply a large lump-sum payment to your mortgage principal and the servicer re-runs the amortization on the remaining balance over the same remaining term, at the same rate. Your monthly payment drops; your payoff date stays the same.

A refinance replaces your existing loan with a new loan, usually with a new rate, new term, an appraisal, and closing costs. A recast keeps your loan, rate, and payoff date; you only pay a small servicer fee (often $150 to $500) and the lump-sum principal payment.

Most servicers require a minimum lump-sum principal payment, commonly $5,000 to $10,000. Some have a higher floor or a minimum percentage of the loan balance. The recast fee is a flat charge, not a percent of the loan. Check your loan agreement or call your servicer.

No. Most conventional (Fannie Mae, Freddie Mac) and jumbo loans allow recasting, but FHA, VA, and USDA loans typically do not. Some servicers limit recasts to one per loan or require a waiting period after origination. Always confirm before sending the lump sum.

Both reduce total interest. Extra principal payments keep your minimum monthly payment the same and shorten the payoff date. A recast lowers your minimum monthly payment but does not change the payoff date. Recasting is useful if you want lower required cash flow each month, for example after a windfall or home sale.

No. The rate on a recast stays the same as your current loan. If your current rate is much higher than today's market, a refinance (which gives you a new rate) usually saves more money than a recast, even after closing costs.

Monthly savings depend on the lump sum, the rate, and the remaining term. Lifetime interest savings are larger early in the loan when more of each payment is interest. The calculator shows both numbers based on the inputs you provide.