What Is a Mortgage Recast?

If you’ve recently come into extra cash—like a bonus, inheritance, or proceeds from selling another property—you may be wondering how to use it to reduce your mortgage payments. A mortgage recast might be the perfect solution.

Also called a reamortization, a mortgage recast allows you to make a lump-sum payment toward your mortgage principal, and then have your lender recalculate your monthly payment based on the new, lower balance. The best part? You keep your original interest rate and loan term.

How Does it Work?

Here’s a step-by-step breakdown of how a mortgage recast works:

• You make a large principal payment (typically $5,000 or more).
• Your lender recalculates your mortgage payments based on the new balance.
• Your monthly payment decreases, but your loan term and interest rate stay the same.

Unlike a refinance, a mortgage recast doesn’t require a credit check, appraisal, or extensive paperwork.

Beneficios

Lower Monthly Payments
Reduce your financial burden without extending your loan through a mortgage recast.

No New Loan or Interest Rate
A mortgage recast allows you to keep your current terms and avoid refinancing fees.

No Credit Check
This is a great for borrowers who want to avoid impacting their credit.

Minimal Cost
Most lenders charge a small fee (usually around $250), making it a cost-effective alternative to refinancing.

Who Qualifies?

Most conventional fixed-rate loans are eligible. However, FHA, VA, and USDA loans typically do not qualify.

To be eligible, you must:

• Be current on your mortgage
• Have a conventional loan
• Make a lump-sum payment that meets your lender’s minimum requirement

Does ALCOVA Offer this?

Yes! ALCOVA Mortgage offers mortgage recasting on eligible conventional loans. If you’re looking to lower your monthly payment without refinancing, a mortgage recast is a great option to explore.

Have questions about whether your loan qualifies for a mortgage recast? Our team is here to help.

Is it Right for You?

This could be ideal for you if:

• Want to reduce your monthly payment
• Don’t want to go through the refinancing process
• Have a large lump-sum payment available
• Plan to stay in your home long-term

Final Thoughts

A mortgage recast can be a powerful financial tool—especially for homeowners who want a lower payment without the hassle of refinancing. At ALCOVA Mortgage, we’re committed to helping you find a better way to manage your home loan.

Ready to lower your mortgage payments?
Contact ALCOVA Mortgage to find out if this is right for you.