Mortgage Recast Calculator
Make a large lump-sum payment and have your lender re-amortize the smaller balance — lowering your payment while keeping the same rate and payoff date.
How the mortgage recast calculator works
A recast lets you put a large lump sum toward principal, after which the lender re-amortizes the smaller balance across your remaining term at the same rate. The calculator takes your current balance, the lump sum, and the months left, then recomputes a lower monthly payment from that reduced principal.
What stays fixed is as important as what changes: your interest rate and payoff date do not move, only the payment shrinks. The result shows the new payment, the reduction, and the modest lender fee a recast typically charges.
Worked example: with current loan balance of $300,000, interest rate of 6.50% and years remaining of 27, the mortgage recast calculator shows new monthly payment of $1,704.44.
- Current payment
- $1,966.66
- Payment after recast
- $1,704.44
- Monthly reduction
- $262.22
- Interest saved
- $44,960
| Lump-sum payment | New monthly payment |
|---|---|
| $20,000 | $1,835.55 |
| $40,000 | $1,704.44 |
| $75,000 | $1,475.00 |
| $120,000 | $1,180.00 |
The formula
The new payment applies the standard amortization formula, Payment = P × r ÷ (1 − (1 + r)^−n), to the balance after the lump sum, using your unchanged monthly rate and remaining number of payments. Because the term and rate hold steady, the lower principal alone drives the smaller payment.
- The lump sum is applied to principal before re-amortization, not held in escrow or credited toward future payments.
- The interest rate and remaining term are unchanged, since a recast adjusts only the monthly payment amount.
- A flat lender fee is assumed for the recast; actual charges vary and some loan types are ineligible entirely.
- Government-backed loans such as FHA and VA generally cannot be recast, a limitation the calculator does not enforce.
- Escrowed taxes and insurance are excluded, so your full housing bill falls by less than the principal-and-interest payment.
Results are estimates for educational purposes and are not financial advice. Confirm exact figures with your lender or a licensed advisor.
Questions about the mortgage recast calculator
How does recasting differ from simply prepaying my mortgage?
Both shrink the balance, but they spend the benefit differently. Ordinary prepayment keeps your payment the same and shortens the term, so you finish early. A recast keeps the term and lowers the payment instead, easing monthly cash flow.
Prepaying saves more total interest; recasting trades some of that saving for breathing room each month.
Can I recast after making several extra payments over time?
Often yes. Many lenders let you recast once your balance has dropped enough or you make a qualifying lump sum, even if it accumulated from earlier extra payments. There may be a minimum principal reduction required and a waiting period after closing.
Policies differ widely, so confirm your servicer's specific rules and fee before counting on it.
Why would I recast instead of refinancing into a lower payment?
A recast keeps your existing rate, term, and loan intact, with no new appraisal, credit pull, or full closing costs, just a small fee.
That makes it attractive when your current rate is already low and a refinance would reset you to a higher one. Refinancing wins only when a meaningfully lower rate offsets its larger upfront cost.
Is the Mortgage Recast Calculator free to use?
Yes. Every calculator on MortgageLoansCalculator is completely free, with no sign-up, login or paywall. Run as many scenarios as you like.
What is a mortgage recast?
A recast applies a large lump-sum payment to your principal, then re-amortizes the loan so the monthly payment drops — while keeping your original rate and term.
It is cheaper than refinancing (a small fee, no new loan) but it does not change your rate.
Recast or refinance — which is better?
Recast if you have a lump sum and a rate you are happy with — it lowers the payment cheaply without touching the rate. Refinance if the current market rate is meaningfully lower than yours, since that changes the rate itself. This calculator shows the new payment either way.
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