Guide
Mortgage recast vs refinance: which lowers the payment
Compare a mortgage recast with a refinance. A recast keeps your rate and term. A refinance can change rate, term, and insurance, but it resets closing costs and the clock.
Keep the loan or replace it
A recast keeps your existing note. A refinance replaces it. If your interest rate is already low, a recast after a lump sum is often cheaper than paying closing costs to refinance into a higher rate.
PMI and MIP differences
A refinance into a conventional loan with 20 percent equity can eliminate PMI or MIP entirely. A recast only changes the payment on the same loan. It may help you reach a PMI cancellation threshold, but it does not by itself cancel insurance.
Cost and timing
Recast fees are usually a few hundred dollars and take a few weeks. Refinances take longer, require underwriting, and can include appraisal, title, and lender fees. Run both options before you move a large lump sum.
Ready to check your loan?
See if you can cancel PMI and get a letter tailored to your servicer.
Check My Eligibility