# Mortgage recast

> A mortgage recast re-amortizes your loan after a large principal payment, lowering the monthly payment while the rate and payoff date stay the same.

URL: https://mortgage-math-us.com/glossary/recast/  
Last reviewed: 2026-10-29 · By the MortgageMath US Editorial team

## Quick answer

**A mortgage recast** (re-amortization) is when you make a large lump-sum payment toward [principal](https://mortgage-math-us.com/glossary/principal/) and the servicer recalculates your monthly payment over the remaining term based on the new, lower balance. The interest rate and payoff date stay the same.

## Key facts

| Fact | Value | Source | As of |
|---|---|---|---|
| 30-year fixed average (used in the example) | 7.24% | [Freddie Mac Primary Mortgage Market Survey](https://www.freddiemac.com/pmms) | Week of Oct 29, 2026 |

## Example

You took a $300,000 30-year loan at 7.24% with a payment of $2,044. Five years in, you owe $283,107 and pay down $50,000 — say, from the sale of a previous home. After a recast, the payment on the remaining $233,107 drops to $1,683, saving $361 a month for the last 25 years.

Without a recast, the same lump sum keeps the payment at $2,044 but pays the loan off in about 16 years instead of 25. Recasting buys monthly breathing room; skipping it saves more interest.

## Recast vs refinance

A recast keeps your existing loan, so there’s no new application or closing costs — usually just a servicer fee. It can’t lower your rate, though; only a [refinance](https://mortgage-math-us.com/glossary/refinance/) does that. Not every loan or servicer offers recasting, and servicers set their own minimum lump sums, so ask yours before you send the money. The [extra payment calculator](https://mortgage-math-us.com/tools/extra-payment-calculator/) shows the payoff side of the trade-off, and the [amortization](https://mortgage-math-us.com/glossary/amortization/) schedule shows why early principal saves the most interest.

## Sources

- [Freddie Mac Primary Mortgage Market Survey](https://www.freddiemac.com/pmms) — 30-year fixed rate, national weekly average (Week of Oct 29, 2026)
- [Fannie Mae: Re-amortized (recast) mortgages](https://singlefamily.fanniemae.com/job-aid/loan-delivery/topic/recast_mortgage.htm)

_General information, not financial advice._