Struggling with high mortgage payments but don’t want to refinance? Recasting your mortgage could be the perfect solution. Recasting allows homeowners to reduce their monthly payments by making a lump-sum payment toward their mortgage principal, recalculating the balance without needing a new loan. Here's a quick breakdown of how it works and when to consider it.
At Sell2Rent, we help homeowners find flexible solutions like sale-leasebacks if recasting doesn’t fit your needs. But first, let's explore the benefits of recasting your mortgage.
Recasting a mortgage is a process where you make a large lump-sum payment toward your mortgage principal, and your lender recalculates your monthly payment based on the new loan balance. The best part? Your interest rate and loan term stay the same, and you avoid the complexity and costs of refinancing.
Recasting helps you lower your payments without the need to refinance. If you’ve received a windfall (tax refund, inheritance, etc.), this is a simple way to reduce payments without changing your loan terms.
Unlike refinancing, recasting doesn’t require a credit check or any closing costs. This makes it an affordable option for homeowners who want immediate relief.
If you have a low interest rate, recasting lets you keep it while lowering your monthly payments, unlike refinancing, which might bring a higher rate.
|
Feature |
Recasting |
Refinancing |
|
Closing Costs |
No closing costs |
High costs (appraisal, fees, etc.) |
|
Credit Check |
No credit check |
Credit check required |
|
Interest Rate |
Same rate |
New rate (could be higher) |
|
Time to Complete |
Quick |
Longer process |
|
Eligibility |
Conventional loans only |
Works for all types of loans |
Recasting is typically faster and cheaper than refinancing, especially if you’re happy with your current rate and only need relief on your monthly payments.
If recasting doesn’t seem like the right fit, other options include:
Refinancing could lower your rate or change your loan terms, but it comes with fees and a credit check. If rates are lower than your current loan, this might be a good option.
If you need cash now and want to stay in your home, a sale-leaseback could be a better option. With this solution, you sell your home to an investor and lease it back, unlocking equity without moving. Sell2Rent specializes in this solution, allowing you to remain in your home while accessing needed funds. Learn more about a sale-leaseback here: https://www.sell2rent.com/how-it-works
Considering a sale-leaseback? Talk to one of our advisors today
At Sell2Rent, we offer flexible solutions for homeowners in need of financial relief. If you’re facing difficulties with mortgage payments, we can guide you through the sale-leaseback process, allowing you to sell your home and stay as a renter, freeing up cash while keeping your home.
Tip: If recasting doesn’t reduce your payments enough, a sale-leaseback could be the answer to unlocking your home’s equity while maintaining stability.
Recasting is a great way to lower your monthly mortgage payments without the hassle of refinancing, especially if you’ve received a lump sum of money. However, it may not be suitable for everyone, particularly if you need cash from your home’s equity or if your loan isn’t eligible for recasting.
At Sell2Rent, we provide sale-leasebacks, a powerful alternative that lets you access your home’s equity without moving. If you’re unsure which option is best for you, reach out to our team for personalized guidance on your options.