Mortgage Recast Calculator — Lower Monthly Payment After Lump Sum
A mortgage recast recalculates your monthly payment after a large principal payment while keeping the same interest rate and remaining term. On a $320,000 balance at 6.5% with 25 years left, a $50,000 lump sum can drop the payment by roughly $330/month for a modest recast fee. Unlike refinancing, recasting avoids new closing costs and credit checks in most cases.
New Monthly Payment
$1,823
Saves $338/mo vs. $2,161
- Balance After Recast
- $270,000
- Interest Saved
- $51,031
Post-Recast Amortization Schedule (Annual Summary)
| Year | Payments | Interest | Principal | Ending balance |
|---|---|---|---|---|
| 1 | $21,877 | $17,419 | $4,458 | $265,542 |
| 2 | $21,877 | $17,120 | $4,757 | $260,786 |
| 3 | $21,877 | $16,802 | $5,075 | $255,710 |
| 4 | $21,877 | $16,462 | $5,415 | $250,295 |
| 5 | $21,877 | $16,099 | $5,778 | $244,518 |
| 6 | $21,877 | $15,712 | $6,165 | $238,353 |
| 7 | $21,877 | $15,299 | $6,577 | $231,776 |
| 8 | $21,877 | $14,859 | $7,018 | $224,758 |
| 9 | $21,877 | $14,389 | $7,488 | $217,270 |
| 10 | $21,877 | $13,887 | $7,989 | $209,281 |
Methodology and limitations
Last reviewed:
Methodology
Re-amortizes remaining balance over unchanged term after lump-sum principal.
Limitations
Not all servicers offer recast. FHA/VA loans typically ineligible.
Official sources
How to Use the Mortgage Recast Calculator — Lower Monthly Payment After Lump Sum
A mortgage recast recalculates your monthly payment after a large principal payment while keeping the same interest rate and remaining term. On a $320,000 balance at 6.5% with 25 years left, a $50,000 lump sum can drop the payment by roughly $330/month for a modest recast fee. Unlike refinancing, recasting avoids new closing costs and credit checks in most cases.
Method used
Re-amortizes remaining balance over unchanged term after lump-sum principal payment.
Practical example
Example: $50,000 lump sum on $320,000 balance — see new lower monthly payment.
What this includes
- Shows payment reduction after recast.
- Includes recast fee input.
What this excludes
- FHA/VA loans typically cannot recast.
Frequently Asked Questions
What is a mortgage recast?
Recasting (or re-amortizing) applies a lump-sum principal payment and spreads the reduced balance over the remaining months at the same rate. Your payoff date stays the same but the monthly payment drops. Not all loans or servicers offer recasting — conventional loans often qualify; FHA, VA, and USDA typically do not. Confirm with your servicer.
Recast vs refinance — which saves more?
Refinancing replaces the loan and can lower the rate but involves closing costs and a new term. Recasting keeps your existing rate and term while lowering payment after a lump sum. Recast wins when your rate is already low and you have cash to apply to principal. Refinance wins when market rates dropped significantly. Compare both scenarios with this recast calculator and the refinance calculator.
How much does a mortgage recast cost?
Servicer recast fees often range from $0 to $500. There is no standard government fee. You also need a minimum lump sum — commonly $5,000 to $10,000 or more. Enter your lump sum and recast fee to see net payment reduction and interest saved over the remaining term compared with not recasting.
Does recasting shorten my loan term?
No. A standard recast lowers the monthly payment but keeps the same remaining term. To shorten the term, keep paying the old higher payment after recasting or make extra principal payments. Use the mortgage payoff calculator to model early payoff with extra payments instead of or in addition to recasting.
When should I recast my mortgage?
Recast when you receive a large lump sum (bonus, inheritance, home sale proceeds) and want lower mandatory payments without refinancing. It preserves a favorable existing rate. If rates fell or you need cash-out, refinancing may be better. Ensure you retain adequate emergency reserves after the lump sum.