How to Use This Tool
Compare the scheduled payment before and after applying a principal reduction over the remaining term. Estimate a mortgage recast payment, monthly reduction and remaining interest using principal, lump sum, rate and months left.
The decision this tool supports
A lump-sum principal payment does not automatically lower every mortgage payment; the servicer must permit and process a recast. This page keeps the decision bounded to estimated recast payment and the supporting outputs shown beside it. Mortgage Recast does not import an account, infer a market rate, or silently substitute an industry average.
Inputs and units
The Mortgage Recast calculation uses Outstanding principal, Principal reduction, Annual interest rate, Remaining term. Keep all money values in one currency and all time, distance, mass, energy or volume entries in the unit printed beside the field. Mixing Mortgage Recast scopes can produce a plausible number with the wrong meaning.
- Outstanding principal is entered in currency.
- Principal reduction is entered in currency.
- Annual interest rate is entered in %.
- Remaining term is entered in months.
Formula and worked check
For a positive monthly rate r and n remaining payments, payment = principal × r ÷ (1 − (1+r)^−n); zero interest uses principal ÷ n. At $250,000 principal, a $50,000 reduction, 6% rate and 240 months remaining, estimated payment falls from $1,791.08 to $1,432.86. The Mortgage Recast default is an executable known-answer case, not a benchmark or recommendation. Change one input and verify that the direction of estimated recast payment still matches the stated relationship.
How to interpret the result
The calculated payment is a mathematical estimate. Ask the servicer for eligibility, fee, timing, escrow and official payment figures before sending funds. The additional Mortgage Recast outputs expose the denominator, comparison, capacity or reverse value needed to audit the primary result instead of presenting one unexplained number.
Assumptions
- The interest rate and remaining term stay unchanged after recast.
- Payments are monthly and fully amortizing.
- The principal reduction is applied before the new schedule begins.
Save the Mortgage Recast input values and date with any material decision. A later Mortgage Recast rerun is reproducible only when the same assumptions and units are available.
Limitations and safety boundary
The model excludes escrow, recast fees, interest accrued between statements, prepayment restrictions, rounding and lender-specific schedules. Mortgage Recast is an estimate and cannot replace a contract, local code, licensed professional, calibrated measurement, lender statement or platform report where one governs the decision.
Source and privacy
The Mortgage Recast definition or rule was checked against Consumer Financial Protection Bureau — Consumer handbook on adjustable-rate mortgages on 2026-08-26. Recheck Consumer Financial Protection Bureau — Consumer handbook on adjustable-rate mortgages when a specification or policy behind Mortgage Recast can change. Mortgage Recast arithmetic runs in this browser tab; ecech does not receive the values through a calculation API.
Sources & assumptions
Tool Spec v2 · verified 2026-08-26. Platform rules and fees can change; the editable inputs remain authoritative for your account.
Official references
- Consumer Financial Protection Bureau — Consumer handbook on adjustable-rate mortgages (checked 2026-08-26)
Model assumptions
- The interest rate and remaining term stay unchanged after recast.
- Payments are monthly and fully amortizing.
- The principal reduction is applied before the new schedule begins.
- The model excludes escrow, recast fees, interest accrued between statements, prepayment restrictions, rounding and lender-specific schedules.
