The Refinance vs Mortgage Recast Calculator compares the current loan with a recast and a refinance after an entered lump-sum payment. It reports payment, interest, total cost, savings, payoff months, and refinance break-even.
Calculation method
Each payment uses the standard amortization formula:
The recast keeps the current rate and term after reducing principal. The refinance uses the new rate and term and adds closing costs. Break-even compares the upfront cost difference with the monthly payment difference.
Questions
Does a recast lower the interest rate?
No. It reduces the balance used to recalculate payments while keeping the modeled current rate.
Does refinancing always save money?
No. Closing costs, a longer term, and a small rate change can outweigh a lower payment.
Is the recommendation binding?
No. It compares only modeled total costs and does not assess liquidity, lender eligibility, or future rate risk.
Limitations
Verify lender terms, fees, prepayment rules, escrow, taxes, and refinancing eligibility before deciding.