See how a lump sum reshapes your loan. Model recast fees and optional extra payments. Export schedules, compare scenarios, and track long term savings.
| Balance | Rate | Term left | Extra | Fee | Monthly reduction |
|---|---|---|---|---|---|
| $250,000 | 6.50% | 25y | $20,000 | $350 | ≈ $130–$170 |
| $180,000 | 5.75% | 20y | $15,000 | $250 | ≈ $90–$140 |
| $420,000 | 7.00% | 28y | $50,000 | $500 | ≈ $220–$300 |
A recast keeps your interest rate and remaining term unchanged, but recalculates the payment after an immediate principal reduction. For a $250,000 balance at 6.50% with 25 years remaining, a $20,000 lump sum reduces the amortized payment because the new balance is $230,000 across the same 300 months.
Monthly interest is computed as balance × monthly rate, so lowering balance today reduces every future interest charge. The calculator totals remaining interest under the current schedule versus the recast schedule. Larger savings usually come from higher rates, longer remaining terms, and bigger principal reductions. For example, cutting $30,000 from a 7.00% loan with 28 years left can remove thousands in future interest, even if the payment reduction feels modest.
Many lenders charge a recast fee. This tool reports net savings as interest savings minus the fee, and a simple breakeven months estimate as fee ÷ monthly reduction. If the monthly reduction is $150 and the fee is $450, breakeven is about 3 months. This measure ignores opportunity cost and inflation. If you could earn 5% elsewhere, compare that potential return with the interest you avoid.
A refinance can lower the rate or change term, but may involve appraisal, underwriting, and closing costs. A recast typically has lower paperwork and preserves your existing loan, but it will not change the rate. If your rate is already attractive, a recast can improve cash flow without restarting a long term loan. When rates fall, refinancing may outperform a recast despite higher fees.
Use your latest statement for remaining balance, rate, and months left. Confirm whether your payment includes escrow, because this calculator focuses on principal and interest only. Also verify recast eligibility rules, minimum lump sums, and how soon the new payment begins. Export the schedule to document expected balances and payments for budgeting, and keep a copy for lender conversations.
No. A recast keeps your current interest rate and remaining term. It only recalculates the required monthly principal and interest payment after a principal reduction, based on the new balance.
Not by default. A recast is designed to lower the required payment while keeping the same payoff date. You can still pay extra afterward to shorten the term, but that is optional.
Interest is charged on the outstanding balance each month. When you reduce balance immediately, future interest amounts fall across every remaining month, even though the loan still ends on the same date.
It estimates how many months of lower payments are needed to recover the recast fee: fee ÷ monthly payment reduction. It is a simple rule of thumb and does not model investment returns or discounting.
Use calculated payment for standard amortizing loans. Use entered payment if your statement shows a different principal-and-interest payment due to prior adjustments, rounding, or special servicing features.
No. The tool models principal and interest only. If your actual payment includes escrow, add those amounts separately when budgeting and when comparing the “before” and “after” total monthly payment.
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.