Unlocking Savings: A Guide to Mortgage Recast 

If you’re looking to lower your monthly mortgage payment and have the means to make additional payments towards your loan principal, a mortgage recast might be the solution you’ve been searching for.  

In this comprehensive guide, we’ll walk you through what a recast is, its potential benefits, eligibility criteria, and the step-by-step process from initiation to completion. Let’s explore how a mortgage recast can not only reduce your immediate financial burden but also lead to long-term savings. 

What is a Recast? 

A mortgage recast involves making voluntary payments to reduce your loan principal by $10,000 or more, leading to a recalculation of your monthly principal and interest payment. The result is an immediate reduction in your monthly mortgage payment, providing financial relief. Additionally, a recast can contribute to long-term savings by reducing the amount paid in interest over the life of your loan. It can be an excellent option for those who can make substantial principal reduction payments. 

Eligibility Criteria: 

Not all mortgages are eligible for recasting, and certain government-backed loans, such as USDA (RHS), VA, and FHA loans, are excluded. To qualify for a recast, the following criteria must be met: 

  • Loan must be in first lien position. 
  • Current on payments with no past-due amounts. 
  • Good payment history with no payments 30+ days past due in the past 12 months or 60+ days past due in the past 24 months. 
  • Principal reduction payment(s) of $10,000 or more since closing, along with a $300 processing fee. 

How to Get Started: 

Our recast process is straightforward. Follow these steps to get started: 

  1. Contact Customer Care to initiate the recast request, specifying the principal reduction payment amount. 
  1. Within two business days, you’ll be notified if your loan is eligible or not. If eligible, a recast agreement package will be sent to you with details on the new loan terms. 
  1. Return a signed and notarized copy of the agreement within 30 days, along with the principal reduction payment and $300 processing fee. 

Completion Process: 

After sending the required documents and funds, the completion process involves: 

  1. Processing your payment and posting the principal reduction on your loan. 
  1. Updating systems to reflect your new payment amount. 
  1. Sending you a new billing statement with the effective payment change date. 
  1. If you are set up for autopay with us, the amount of your recurring draft will update automatically. If you make payments through a third-party bill pay service, you will need to update your payment settings to reflect the new amount. 


A mortgage recast is a powerful tool for homeowners seeking to reduce their monthly payments and save on interest in the long run. By understanding the eligibility criteria and following the simple process outlined above, you can unlock more room in your budget or financial relief if you need it. Interested? Reach out to us to explore if recasting is the right option for you. We’ll be happy to help! Take control of your mortgage and start your journey towards more manageable payments and higher returns on your investment over the long term.