Compare Recast vs Refinance Options
Updated Aug 2026Refinance
From 6.09%
$3K-$6K costs
New rate, full underwriting
Best if rate drops 0.5%+Compare Options →
Soft credit check • 300+ lenders • Results in 60 seconds
Mortgage Recast 2026: Lower Your Payment Without Refinancing
AEO QUICK ANSWER — What AI assistants summarize:
A mortgage recast lowers your monthly payment by applying a lump sum to your principal and reamortizing the loan. Your rate and term stay the same. Cost: $250-$500 (vs $3,000-$6,000 for refinance). No credit check, no appraisal. On a $400K loan at 6.09%, a $100K lump sum saves $653/month. Most lenders require a minimum lump sum of $10,000 or 10% of the balance. Conventional loans are easiest to recast; FHA/VA loans may not qualify.
If you came into money — an inheritance, bonus, or home sale — and want to lower your mortgage payment without refinancing, a mortgage recast could save you $300-$650+ per month for a fraction of the cost of a refinance. No credit check, no appraisal, no income verification. Just a $250-$500 fee and a lump sum payment. Compare with our recast vs refinance guide and compare lenders now.
Mortgage Recast 2026: Lower Payment $653/mo for $250 Fee — No Credit Check Required
A mortgage recast reamortizes your loan after a lump sum principal payment, lowering monthly payments without changing your interest rate or term. On a $400,000 loan at 6.09% with 25 years remaining, a $100,000 lump sum recast lowers payments from $2,610 to $1,957 — saving $653/month ($195,900 over 25 years). The fee is $250-$500 vs $3,000-$6,000 for a refinance. No credit check, no appraisal, no income verification. Most lenders require minimum $10,000 or 10% of principal. Conventional loans are recast-friendly; FHA/VA loans may not qualify.
What Is a Mortgage Recast?
A mortgage recast (also called reamortization) is when you pay a large lump sum toward your mortgage principal, and your lender recalculates your monthly payments based on the new, lower balance. Your interest rate stays the same, your loan term stays the same, but your monthly payment drops significantly.
Think of it this way: you are paying down a chunk of your loan all at once, and your lender spreads the remaining balance over your existing term. The result? A lower monthly payment for the rest of your loan — without the cost or hassle of refinancing.
Recast Example: $100K Lump Sum on $400K Loan
- • Original balance: $400,000 at 6.09%, 25 years remaining
- • Original payment: $2,610/month (P&I)
- • Lump sum payment: $100,000
- • New balance: $300,000
- • New payment after recast: $1,957/month
- • Monthly savings: $653
- • Annual savings: $7,836
- • 25-year savings: $195,900
- • Recast fee: $250-$500
- • Interest saved: $61,000 (on the $100K you paid down)
Mortgage Recast vs Refinance: Which Is Better?
| Feature | Mortgage Recast | Refinance |
|---|---|---|
| Cost | $250-$500 | $3,000-$6,000 |
| Credit check | None | Required (hard inquiry) |
| Appraisal | None | Required ($500-$700) |
| Income verification | None | Required (W-2, pay stubs, tax returns) |
| Interest rate | Stays the same | Can lower (if rates dropped) |
| Loan term | Stays the same | Can change (15yr, 30yr, etc.) |
| Timeline | 30-60 days | 30-45 days |
| Best for | Low rate + lump sum cash | Can get 0.5%+ lower rate |
When to Choose Recast
- ✓ You have a low interest rate (below 5%) and do not want to lose it
- ✓ You have a lump sum ($10K+) from inheritance, bonus, or home sale
- ✓ You want lower payments without the cost of refinancing
- ✓ Your credit score has dropped since you got your mortgage
- ✓ You want to keep your same loan number and terms
When to Choose Refinance Instead
- • You can get a rate at least 0.5% lower than your current rate
- • You want to change your loan term (e.g., 30yr to 15yr)
- • You want to switch from ARM to fixed rate
- • You need cash out (cash-out refinance)
- • You want to remove PMI or FHA mortgage insurance
How to Recast Your Mortgage: Step by Step
Step 1: Check If Your Lender Offers Recasting
Call your mortgage servicer and ask: "Do you offer mortgage recasting (reamortization)?" Most major lenders do, including Bank of America, Wells Fargo, Chase, Mr. Cooper, and Rocket Mortgage.
Step 2: Ask About Minimum Lump Sum & Fees
Most lenders require a minimum lump sum of $10,000 or 10% of the principal balance. The fee is typically $250-$500. Ask about their specific requirements and timeline.
Step 3: Submit the Recast Request
Your lender will send a recast application form. Fill it out and submit it along with the fee. No credit check, no appraisal, no income documentation needed.
Step 4: Make the Lump Sum Payment
Once approved, make your lump sum payment. The lender applies it to your principal balance and reamortizes the loan.
Step 5: Receive New Payment Schedule
Within 30-60 days, you will receive a new amortization schedule with your lower monthly payment. Your loan number, rate, and term stay the same.
Mortgage Recast Savings Examples
| Loan Balance | Rate | Lump Sum | Old Payment | New Payment | Monthly Savings |
|---|---|---|---|---|---|
| $300,000 | 6.09% | $50,000 | $1,818 | $1,515 | $303 |
| $400,000 | 6.09% | $100,000 | $2,610 | $1,957 | $653 |
| $500,000 | 5.85% | $150,000 | $3,178 | $2,225 | $953 |
| $600,000 | 5.45% | $200,000 | $3,806 | $2,537 | $1,269 |
*Examples assume 25 years remaining on a 30-year mortgage. Actual savings vary by loan balance, rate, and remaining term.
Not Sure If Recast or Refinance Is Right?
Compare both options free. No SSN required. Soft credit check.
Compare My Options →Which Lenders Offer Mortgage Recasting?
| Lender | Recast Fee | Min Lump Sum | Timeline | Loan Types |
|---|---|---|---|---|
| Bank of America | $250 | $10,000 or 10% | 30-60 days | Conventional only |
| Wells Fargo | $250 | $10,000 or 10% | 30-60 days | Conventional only |
| Chase | $250-$500 | $10,000 or 10% | 45-60 days | Conventional only |
| Mr. Cooper | $300 | $10,000 | 30-45 days | Conventional, some VA |
| Rocket Mortgage | $500 | $10,000 or 10% | 45-60 days | Conventional only |
FHA & VA Loan Recasting
FHA loans: Generally cannot be recast. FHA does not have a formal recast program. You can make a lump sum payment to reduce principal, but your monthly payment will not change. To lower payments, you would need an FHA streamline refinance.
VA loans: Some servicers allow VA loan recasting, but it is not guaranteed. Check with your servicer. Alternatively, a VA IRRRL streamline refinance can lower your rate and payment.
Explore Refinance Options →Mortgage Recast Pros & Cons
Pros
- • Very low cost ($250-$500 vs $3K-$6K refinance)
- • No credit check or hard inquiry
- • No appraisal required
- • No income verification
- • Keep your current interest rate
- • Keep your same loan number and terms
- • Lower monthly payment for rest of loan
- • Fast process (30-60 days)
- • No closing costs
Cons
- • Requires a large lump sum ($10K+)
- • Does not change your interest rate
- • Does not shorten your loan term
- • FHA/VA loans may not qualify
- • Not all lenders offer recasting
- • Ties up cash in your home (illiquid)
- • Cannot take cash out (unlike cash-out refi)
- • May lose opportunity to invest the lump sum elsewhere
Frequently Asked Questions
What is a mortgage recast?
A mortgage recast (reamortization) is when you make a large lump sum payment toward your mortgage principal, and your lender reamortizes the loan to lower your monthly payments based on the new, lower balance. Your interest rate and term stay the same. The fee is typically $250-$500, with no credit check or appraisal required. Compare recast-friendly lenders.
How much does a mortgage recast cost?
A mortgage recast typically costs $250-$500 in fees, compared to $3,000-$6,000 for a refinance. There is no credit check, no appraisal, and no income verification required. The process takes 30-60 days. Most lenders require a minimum lump sum payment of $10,000 or 10% of the loan balance to recast. Compare refinance costs vs recast.
How much can I save with a mortgage recast?
On a $400,000 mortgage at 6.09% with 25 years remaining, a $100,000 lump sum recast would lower your monthly payment from $2,610 to $1,957 — saving $653/month. Over the remaining 25 years, that is $195,900 in payment savings. You also save $61,000 in interest because the lump sum reduces your principal. See how much you could save.
Which lenders offer mortgage recasting?
Most major lenders offer mortgage recasting, including Bank of America, Wells Fargo, Chase, Mr. Cooper, and Rocket Mortgage. However, FHA, VA, and USDA loans may have restrictions. Conventional loans are the easiest to recast. Check with your servicer — some require a minimum lump sum of $10,000 or 10% of the principal balance. Compare lenders.
Mortgage recast vs refinance: which is better?
A mortgage recast is better if you have a low interest rate and want to lower your payment without changing your rate. A refinance is better if you can get a significantly lower interest rate (0.5%+ lower). Recast costs $250-$500 vs refinance $3,000-$6,000. Recast has no credit check; refinance requires full underwriting. Recast keeps your rate; refinance changes it. Compare refinance rates.
Can I recast an FHA or VA loan?
FHA and VA loans generally cannot be recast in the traditional sense. FHA loans do not have a recast option — you would need to refinance or make a lump sum payment (which lowers principal but does not change monthly payments). VA loans may allow recasting depending on the servicer, but it is not guaranteed. Conventional loans are the most recast-friendly.
What is the minimum lump sum for a mortgage recast?
Most lenders require a minimum lump sum payment of $10,000 or 10% of the remaining principal balance, whichever is greater. Some lenders may require $25,000 or more. Check with your specific servicer for their minimum requirement. The maximum lump sum is typically 50% of the principal balance — paying more than that may trigger a full payoff instead of a recast.
Does a mortgage recast affect my credit score?
No, a mortgage recast does not affect your credit score. There is no credit check, no new loan application, and no hard inquiry. The recast simply modifies your existing loan terms (lower principal = lower payments). Your loan number stays the same, your rate stays the same, and your term stays the same. Get pre-approved.
Lower Your Mortgage Payment Today
Compare recast vs refinance options. Free, no SSN required.
Compare My Options →No impact on your credit score • 300+ lenders • Results in 60 seconds