Do you like saving money every month?

I know I do! What if you could save money on your monthly mortgage payment without having to go through the financial, emotional, and mental hurdles of refinancing your mortgage? Sounds too good to be true, right? 

Well, let me introduce you to a very unique and attractive option, recasting.

Mortgage Recasting To Save Money

Recasting your mortgage occurs when you, the borrower, make a one-time payment (usually $10,000 or more) that goes directly towards your principal loan balance. There is often a small fee to recast (typically around $250) but will depend on your loan servicer. 

Mortgage Lender Recalculations

The lender will recalculate your current monthly payment based on the new loan principal loan balance after the recast. They cannot change your mortgage product, term, or interest rate. However, they can reamortize your mortgage based on the new loan amount. This is a fantastic benefit to borrowers, since your current monthly payments will be lowered based on your new loan amount and your new amortization schedule. This will reduce your monthly payments without having the costs or potential headaches associated with refinancing your current mortgage. 

The Downside To Recasting

Generally, the downside to recasting is that you have to have typically $10,000 to put towards your mortgage. You must be in a Conventional mortgage. You cannot recast a government mortgage (FHA, VA, or USDA). You can’t adjust your interest rate to a lower rate. You can’t change your term length or product. Most importantly, you can’t get cash out of your loan to finance a purchase or consolidate debt. 

Alternatives To Recasting

If you want to lower your monthly payment AND lower your rate, change your terms, or get cash out, you are going to want to refinance your home.

What's Your Best Option?

Complete the form below and we will help you determine if recasting is right for you.