Mortgage Recast Calculator
See how much you can lower your monthly payment by recasting your mortgage
Compare recasting vs refinancing for Bergen, Essex, Union & Morris Counties
What is Mortgage Recasting?
Mortgage recasting (also called reamortization) is when you make a large lump-sum payment toward your principal balance, and your lender recalculates your monthly payment based on the new, lower balance. Your interest rate and loan term stay the same—you simply pay less each month.
Your interest rate doesn't change
Your loan length stays the same
Reduced monthly payment
Current Loan Details
Most lenders require $5,000-$10,000 minimum
Typical range: $250-$500 (much less than refinancing)
Your Recast Savings
Monthly Payment Reduction
$337.60
Current Payment
$2,700.83
New Payment
$2,363.23
Lifetime Savings Analysis
Break-Even Analysis
You'll recover your recast fee in 2 months, then save $337.60/month for the remaining 298 months.
Mortgage Recast vs Refinance: Which is Right for You?
Mortgage Recast
Best if you want to keep your current rate
- ✓Low cost: $250-$500
- ✓No credit check required
- ✓Keeps current interest rate
- ✓No appraisal needed
- ✓Fast process (2-4 weeks)
- ✓Lowers monthly payment
Refinancing
Best if rates have dropped significantly
- $Higher cost: $2,000-$6,000+ closing
- ✓Credit check required
- ✓Can get a new, lower rate
- ✓Appraisal required
- ✓Longer process (30-45 days)
- ✓Can change loan terms
Mortgage Recasting in Northern New Jersey
Northern NJ homeowners in Bergen, Essex, Union, and Morris Counties often have significant equity built up in their homes due to strong appreciation. This makes mortgage recasting particularly attractive if you've received:
- •A work bonus, inheritance, or investment windfall
- •Proceeds from selling another property
- •A financial gift from family members
- •Business sale proceeds or stock option payout
Example: Bergen County Homeowner
Current loan: $600,000 at 4.5% with 20 years remaining
Current monthly payment: $3,797
After $100,000 lump sum payment + $500 recast fee:
New balance: $500,000
New monthly payment: $3,164
Monthly savings: $633
Total interest saved: $51,900
Explore Mortgage Recast Options by Location
Frequently Asked Questions
What is the minimum lump sum required to recast?
Most lenders require a minimum lump-sum payment of $5,000 to $10,000 to recast a mortgage. Some lenders may have higher minimums, typically around $10,000-$20,000. Check with your lender for their specific requirements.
How much does it cost to recast a mortgage?
Recasting fees typically range from $250 to $500—far less than refinancing, which can cost $2,000-$6,000+ in closing costs. The exact fee varies by lender.
Do all lenders offer mortgage recasting?
No. Recasting availability varies by lender and loan type. FHA, VA, and USDA loans typically cannot be recast. Conventional loans and some jumbo loans usually allow recasting, but you'll need to check with your specific lender.
Does recasting affect my credit score?
No. Mortgage recasting does not require a credit check and will not impact your credit score. It's simply a re-amortization of your existing loan.
Can I recast my mortgage more than once?
It depends on your lender's policies. Some lenders allow multiple recasts over the life of the loan, while others may limit you to one recast. There may be a waiting period between recasts (e.g., 12-24 months).
Should I recast or refinance my mortgage?
Recast if: You have a good current rate, want low costs, and have a lump sum to invest. Refinance if: Current rates are significantly lower than your rate (0.5-1%+ difference), or you want to change loan terms or tap into equity.
How long does the recasting process take?
The recasting process typically takes 2-4 weeks from submitting your lump-sum payment to receiving your new payment schedule. This is much faster than refinancing, which usually takes 30-45 days.
Will recasting remove PMI from my loan?
If your lump-sum payment brings your loan-to-value (LTV) ratio below 80%, you may be able to request PMI removal. However, this is separate from the recast process and may require an appraisal. Contact your lender for specific requirements.
Important Disclaimers:
- Estimates Only: This calculator provides estimates for informational purposes. Actual savings may vary based on your specific loan terms, lender policies, and fees.
- Lender Approval Required: Not all lenders offer mortgage recasting, and eligibility varies by loan type. FHA, VA, and USDA loans typically cannot be recast.
- Minimum Requirements: Lenders typically require a minimum lump-sum payment (often $5,000-$10,000+) and may have other requirements.
- Alternative Considerations: Depending on current interest rates and your financial situation, refinancing might provide greater savings despite higher upfront costs.
- Tax Implications: Consult a tax professional about potential tax implications of making a large principal payment versus alternative uses of funds.
For Personalized Guidance: Contact Jimmy Joseph MBA at (908) 698-0150 to discuss whether mortgage recasting or refinancing is right for your situation.