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Recast vs Refinance vs Paydown

You have a lump sum of cash and a mortgage. Three options, three different tradeoffs. We show the math at your numbers and never declare a winner. Estimates only

Your Numbers

22 yrs

Use a real number for your scenario; check the live pricer for current pricing.

Typical lender admin fee for a recast is $150 to $500. Confirm with your servicer.

Three Paths

Current P&I: $2,175/mo

Recast

Same rate, lower payment

$1,767 /mo

Monthly P&I change: -$408/mo

  • Total interest saved over remaining term: $32,649
  • Recast fee: $250 (one-time)
  • Same rate, same payoff date, lower payment

Refinance

New rate, new loan

$2,974 /mo

Monthly P&I change: +$799/mo

  • Net lifetime impact (after closing costs): -$215,930
  • Closing costs: $5,000
  • Refi rate is above current rate; refi does not break even.

Paydown

Same payment, earlier payoff

$2,175 /mo

Monthly P&I change: no change

  • Total interest saved: $71,645
  • Loan pays off 5.6 years earlier
  • No fee, no closing costs, no rate change
At a refi rate of 7.00% versus your current 3.50%, refinancing INCREASES your monthly payment and adds closing costs. Refi is clearly the wrong move at today's rates if you already have a low rate. Recast keeps your low rate AND lowers your monthly payment. Paydown keeps your rate, keeps your monthly the same, and shortens the loan. Choose between recast (lower monthly payment, same payoff date) and paydown (same payment, earlier payoff) based on whether cash-flow relief or fastest payoff matters more to you.

Recast keeps the rate, lowers the monthly, keeps the payoff date. Refi replaces the loan at today's rate with closing costs. Paydown keeps the rate AND the monthly, but shortens the loan. Not every servicer offers recast; check before counting on it.

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Estimates only. Actual rates, fees, and outcomes vary. Not a commitment to lend. All loans subject to qualification. Equal Housing Opportunity.