Mortgage recast calculator

What a recast does

A mortgage recast takes a lump-sum principal payment and re-amortizes your loan over the same remaining term, which lowers your monthly payment while keeping the same rate and payoff date. It usually costs only a small fee - far less than a refinance - and does not require re-qualifying. This calculator shows the new payment and the interest you save.

Worked example

A $400,000 balance at 6% with 30 years left, applying a $50,000 lump sum:

• Current payment: about $2,398
• New payment after recast: about $2,098
• Monthly saving: about $300
• Lifetime interest saved: about $57,919

You keep the same payoff date but free up $300 a month, and still cut nearly $58,000 of interest because the balance is smaller.

Recast versus paying extra (without recasting)

These solve different problems:

• Recast lowers your required payment - useful for cash-flow relief after a windfall, an inheritance, or selling another property.
• Paying extra without a recast keeps your payment the same and pays the loan off sooner, saving even more total interest.

If your goal is the lowest lifetime interest, pay extra and skip the recast. If you want breathing room in your monthly budget, recast.

When a recast makes sense

• You receive a lump sum and want lower payments without refinancing.
• Your current rate is already good, so refinancing would not lower it.
• Your lender allows recasting (most conventional loans do; many government loans do not).

Common mistakes

• Recasting when you actually want a faster payoff (just pay extra instead).
• Assuming all loans allow it - confirm with your servicer first.
• Refinancing for a lower payment when a cheaper recast would do.

To weigh refinancing instead, see the refinance break-even calculator; to decide between extra payments and investing, see the mortgage payoff vs invest calculator.