Recasting: The best hidden financing tool.
Posted on September 03, 2015
It is interesting to me that many financing options are virtually hidden from the average consumer; The recasting of your existing home mortgage definitely tops my list. While this option does not directly benefit Greatland, it is a greater alternative for those of you who have the means and desire to lower your monthly payment in lieu of re-financing. For those of you who are new to my blog, recasting simply means you want the lender to re-calculate your monthly payment based on the amount of cash used to pay down the principle, the existing interest rate and the existing time period. You do not need to qualify to recast a loan, and you may also be able to remove tax and insurance escrows if you want to make those payments outside of the mortgage. Recasting of a mortgage typically applies to only those who already have a fairly low interest rate and who also have a chunk of cash to apply towards the loan principle. In conclusion, if you contact your lender and tell them you want to Recast your loan, be persistent with your lender in the pursuit of this option and the specific details; they tend to prefer keeping you at the original payment amount with escrows. As always, contact me if there are other topics of home-ownership you would like me to comment on. Stay tuned for more!