Typically,​ ​when​ ​you​ ​make​ ​a​ ​large​ ​principal​ ​payment​ ​on​ ​your​ ​loan,​ ​the​ ​monthly​ ​payment​ ​remains the​ ​same,​ ​but​ ​the​ ​term​ ​of​ ​the​ ​loan​ ​shortens.​ ​​

​However,​ ​if​ ​you​ ​wish​ ​to​ ​lower​ ​the​ ​monthly​ ​payment instead​ ​of​ ​shortening​ ​the​ ​term,​ ​ask​ ​the​ ​lender​ ​if​ ​they​ ​allow​ ​a​ ​recast.​ ​​

​A​ ​recast​ ​is​ ​where​ ​a​ ​large principal​ ​payment​ ​is​ ​made​ ​on​ ​the​ ​loan,​ ​and​ ​the​ ​lender​ ​re-amortizes​ ​the​ ​loan​ ​based​ ​on​ ​the​ ​lower loan​ ​amount​ ​over​ ​the​ ​remaining​ ​period​ ​of​ ​the​ ​loan,​ ​thereby​ ​lowering​ ​the​ ​monthly​ ​payment.

Some​ ​servicers​ ​offer​ ​a​ ​recast,​ ​and​ ​some​ ​do​ ​not.​ ​​ ​If​ ​they​ ​do,​ ​they​ ​typically​ ​charge​ ​a​ ​fee​ ​to​ ​process this​ ​request.​ ​​ ​If​ ​the​ ​servicer​ ​does​ ​not​ ​offer​ ​a​ ​recast,​ ​and​ ​you​ ​want​ ​to​ ​lower​ ​your​ ​monthly payment,​ ​contact​ ​Counsel Mortgage​ ​and​ ​we​ ​can​ ​take​ ​a​ ​look​ ​at​ ​whether​ ​a​ ​refinance​ ​makes​ ​sense.