Homeowner Guide

Recast Your Mortgage

After a large principal payment, a recast re-amortizes your remaining balance so the monthly payment can drop — without refinancing, changing your rate, or opening a new loan. Investor and servicer rules vary, so Ryan and Steve confirm eligibility before anyone promises a date or a payment.

Ask About a Recast

Your Payment Does Not Drop Overnight

Sending extra principal reduces what you owe. It does not automatically change the billed monthly payment until a recast is approved and processed.

{[ ['Principal first, payment later', 'After a substantial principal reduction, the updated monthly payment typically will not be reflected immediately. The servicer still has to recast the loan.'], ['About 2–4 weeks', 'In many cases, borrowers should expect approximately 2–4 weeks for the recast to be processed after the required principal payment has been made and all investor and servicer requirements have been satisfied.'], ['Not a guaranteed date', 'We do not promise a specific recast timeline or eligibility until the applicable investor and servicer requirements have been confirmed for your loan.'], ['Same rate, new payment', 'A recast keeps your interest rate and remaining term. It only recalculates the payment on the lower principal balance.'], ['Current loans only', 'The loan generally must be current. Bring any past-due amount current before requesting a recast.'], ].map(([title, desc], idx) => (

))}

Every Investor Is Different

Your loan may be sold to an investor or retained for servicing. Recast rules follow that investor, not a one-size-fits-all checklist. Borrowers should generally be advised of the items below, then wait for confirmation on their specific loan.

{[ ['$250–$500 recast fee', 'There may be a recast fee, typically in the $250–$500 range. The exact amount depends on the investor and servicer.'], ['Loan must be current', 'Most recasts are available only when the mortgage is current, with no outstanding late payments.'], ['Often $10,000 minimum', 'A minimum principal reduction is typically required, often around $10,000. Some investors set a higher floor.'], ['Other rules may apply', 'Additional investor or servicer requirements may apply — documentation, occupancy, or product restrictions included.'], ].map(([t, d]) => (

))}

Initial Payments and Seasoning May Be Required

Before a recast can be completed, some investors may require extra time after closing. That is another reason we set realistic expectations at the beginning of the process.

    {[ 'A minimum number of payments may need to have been made', 'The loan may need to be fully onboarded by the servicer', 'The loan may need to be securitized before the recast can be processed', 'We confirm those gates with servicing before you send a large principal payment expecting a new bill', ].map((item) => (
    • ))}

Recast vs. Refinance

Both can lower a payment. They are not the same tool.

    {[ 'Recast: same loan, same rate, same term — lower payment after a lump-sum principal reduction', 'Refinance: a new loan that can change rate, term, or loan type, with closing costs and underwriting', 'Recast is often cheaper when you like your rate and just want the payment to match a large principal paydown', 'Refinance may be better if rates have dropped or you need cash-out, a term change, or a different product', ].map((item) => (
    • ))}

Set the Timeline Up Front

As a general expectation — not a guarantee — borrowers should be prepared for this sequence.

{[ ['Make 1–3 payments', 'Get the loan current and through any required seasoning, onboarding, or securitization window.'], ['Complete the principal reduction', 'Send the required lump-sum principal — often around $10,000 or more — after we confirm the investor minimum and fee.'], ['Allow about 2–4 weeks', 'Once the payment and requirements are in, processing commonly takes approximately 2–4 weeks before the new monthly amount appears.'], ].map(([t, d], i) => (

Step {i + 1}

))}

More Visibility When Servicing Stays With Us

On eligible agency loans, keeping servicing with Luminate Bank gives Ryan and Steve more control and visibility into the recast. That lets us coordinate with our servicing team instead of sending you to an unknown servicer to ask about a payment that has not updated yet.

Not every loan is retained, and not every retained loan is recast-eligible. We will tell you which situation you are in before you plan a principal payment around a new monthly bill.

What we confirm with you

    {[ 'Whether your investor allows a recast', 'Minimum principal amount and recast fee', 'Seasoning, onboarding, or securitization timing', 'Whether servicing is retained so we can stay involved', 'When the new payment should appear on your statement', ].map((item) => (
    • ))}

Keep Exploring

Related guides if a recast is not the only option on the table.

Homeowner Solutions

Refinance, cash-out, reverse mortgage, and other options if a recast is not the right fit.

Conventional Refinance

Compare a recast with a rate-and-term refinance.

When Can PMI Be Removed?

A large principal payment can also help you reach the PMI-removal threshold.

Contact Us

Ask Ryan or Steve to review recast eligibility on your loan.

Frequently Asked Questions

Thinking About a Recast?

Tell Ryan or Steve your loan type, balance, and how much principal you can apply. We will check investor and servicer rules before anyone counts on a new payment date.

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