Mortgage Recast Calculator

A recast lets you make one large principal payment and have the lender re-spread the smaller balance over the remaining term — same rate, same end date, lower monthly payment. Enter your balance, rate, remaining term and lump sum to see the new payment.

Results

Assumptions: The remaining term and interest rate stay unchanged after the lump-sum payment, and the lender agrees to recast.

Formula

The recast re-amortizes the reduced balance over the same remaining months:
New payment = (Balance − Lump sum) × r ÷ (1 − (1 + r)−n)
Only the payment changes — the rate and the payoff date stay the same.

How to use this calculator

  1. Enter your current balance, rate and the years left on the loan.
  2. Enter the lump sum you plan to pay toward principal.
  3. Press Calculate to compare the old and new payments.
Mortgage Recast Calculator — how the calculation works, illustrated$
Mortgage Recast Calculator — how the calculation works, illustrated

Worked example

A $240,000 balance at 6% with 30 years left, plus a $40,000 lump sum.

  1. Current payment on $240,000: about $1,438.92.
  2. New balance: $200,000.
  3. Re-amortized payment: about $1,199.10.

Result: The payment drops by about $239.82 a month.

Frequently asked questions

How is a recast different from refinancing?

A refinance replaces the loan entirely — new rate, new term, closing costs and a credit check. A recast keeps your existing loan and rate, usually for a modest fee, and only re-spreads the balance.

How is a recast different from just paying extra each month?

Extra payments shorten the loan and cut interest but do not lower the required monthly payment. A recast lowers the required payment, which helps cash flow but keeps the original end date.

Do all loans allow recasting?

No. Many conventional loans do; government-backed loans (FHA, VA, USDA) generally do not. Ask your servicer — there is usually a minimum lump sum and a processing fee.

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