Is There a Way to Lower My Monthly Payment, Such as Recasting, After I Sell My Home and Put a Lump Sum Toward My Mortgage?
Yes, on most conventional loans, including jumbo loans. With a recast, you pay a lump sum toward principal and the servicer recalculates your payment on the lower balance, at the same rate and over the same remaining term, without a refinance. FHA, VA and USDA loans generally can't be recast, and even on an eligible loan the servicer has to approve it.
Last updated September 29, 2026How does a recast work?
There's no new loan, no new rate and usually no credit check or appraisal. You make a large payment toward principal, often from a home sale, an inheritance or a bonus. The servicer then recalculates your monthly payment using the smaller balance, the same number of months left and your existing rate. The payoff date stays the same, so the payment drops.
Which loans can be recast?
Generally conventional loans, both conforming and jumbo. FHA, VA and USDA loans generally aren't eligible. Even on an eligible loan, approval isn't automatic: servicers commonly look at a minimum lump sum, your payment history and sometimes how long you've had the loan.
What does it cost, and how long does it take?
Servicers commonly charge a modest processing fee, often a few hundred dollars. After you send the lump sum and any paperwork, the new payment usually takes effect within a few weeks, though some servicers take up to about 90 days. Keep paying the old amount until you get the new schedule.
A recast lowers your payment, not your rate. If a lower rate is the goal, compare a refinance instead.
It depends on your situation:
- You have a conventional or jumbo loan: ask your servicer; recasting is generally available.
- You have an FHA, VA or USDA loan: a lump sum still reduces your balance, but it won't trigger a lower payment through a recast.
- Your lump sum is below the servicer's minimum, or your payment history has problems: the servicer may say no.
- You need the lower payment right away: plan for a few weeks of processing.
| Eligible loans | Conventional, including jumbo |
|---|---|
| Generally not eligible | FHA, VA and USDA |
| Rate and term | Unchanged |
| Credit check or appraisal | Usually not required |
| Fee | Often a few hundred dollars |
| Time to take effect | A few weeks, sometimes up to about 90 days |
Related questions
- do I Need a Home Appraisal for This Loan, or Can It Be Waived
- can I choose my own appraiser, use my own contact, or ask to avoid a specific appraiser
- do I Have to Pay for the Appraisal Out of Pocket, and Is It Refunded If My Loan Doesn't Close
- can I Reuse or Transfer an Appraisal I Already Paid For to a New Lender
- how much home equity you can access
Sources
- https://www.rocketmortgage.com/learn/recast-mortgage
- https://www.mrcooper.com/blog/recasting-a-mortgage
- https://www.pnc.com/insights/personal-finance/borrow/what-is-mortgage-recast.html
- https://www.experian.com/blogs/ask-experian/how-to-recast-mortgage
- https://www.amerisave.com/glossary/recasting-a-mortgage-what-it-means-and-how-it-works-in
- https://www.veteransunited.com/education/va-loan-recast
- https://www.chase.com/personal/mortgage/recast
- https://delawaremortgageloans.net/ask-mortgage-lender-about-recasting
- https://www.thetruthaboutmortgage.com/mortgage-recast-calculator
- https://www.myuwmloan.com/help-center/payments/mortgage-recast
- https://www.experian.com/blogs/ask-experian/what-is-mortgage-recasting
- https://www.bankrate.com/mortgages/what-is-mortgage-recasting-and-why-do-it
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.