How long before you can recast a mortgage?

How long before you can recast a mortgage?

You must make at least two consecutive monthly payments at your current payment amount before a loan can be recast. There may be a small fee (typically around $250) associated with the recast. There is not typically a limit around how many times someone can recast their loan.

What does recast your mortgage mean?

A mortgage recast is when a lender recalculates the monthly payments on your current loan based on the outstanding balance and remaining term. When you purchase a home, your lender calculates your mortgage payments based on the principal balance and the loan term. Every time you make a payment, your balance goes down.

Will Wells Fargo recast my mortgage?

Bank of America and Wells Fargo Home Mortgage charge customers $250 for a loan recast. At Wells Fargo, customers must make a lump sum payment of $5,000 or 10 percent of the remaining loan balance, whichever is greater, to qualify for a loan recast.

What is mortgage recasting and why do it?

What is mortgage recasting? A mortgage recasting, or loan recast, is when a borrower makes a large, lump-sum payment toward the principal balance of their mortgage and the lender, in turn, reamortizes the loan. This means that your loan is reduced to reflect the new balance.

What are the requirements to recast with Rocket Mortgage?

You must meet your lender’s payment history requirements. Your lender might require that you have a history of on-time payments before you can recast. For example, Rocket Mortgage requires that you have at least two consecutive on-time payments on your current loan before you recast.

How much money do you need to recast a mortgage?

In order to do a loan recast, borrowers must make a large lump-sum payment toward the loan principal. Lenders usually require $5,000 or more to recast a mortgage. The remaining balance is then amortized to reduce the monthly payments.

Can You recast a home loan with Ginnie Mae?

A mortgage recast reduces your monthly payments for the remainder of the loan. Not everyone can recast. For example, anyone with a government loan backed by Ginnie Mae is excluded from recasting. These include any FHA, USDA or VA loans. The reason these loans are excluded is related to how they are handled by the government.