If you want to lower your monthly mortgage and save thousands of dollars in interest, you’ll want to think about a mortgage recast for your OKC home.
Homeowners understand what an expensive investment owning a property is. According to US Census Bureau, the average mortgage payment for American homeowners is over $1,500. A mortgage recast will allow you to pay less money in interest, which could potentially trim months off of the remainder of your mortgage. After you’ve paid your monthly obligations and have extra cash, you may want to consider making additional mortgage payments to help you pay off your mortgage sooner.
Continue reading to learn more about mortgage recasts and whether it is right for you.
What Is a Mortgage Recast?
A mortgage recast — also called a mortgage reamortization or a loan recast — is when a homeowner makes a large payment towards their mortgage’s principal balance, and the remaining balance on the loan is spread out over the remaining years on the mortgage. This results in a lower monthly mortgage payment for the homeowner and reduces the amount of interest they will pay throughout the life of their loan. Interest rates and the loan’s other terms do not change.
How Much Is a Mortgage Recast Payment?
If a homeowner wishes to recast their mortgage, a lender typically requires a payment of $5,000 or more. A homeowner can also expect a fee of around $250-300 to recast their mortgage, though this cost varies by lender.
Is a Mortgage Recast Right for Me?
There are a few things to consider when thinking about recasting your mortgage. First, you must talk to your lender to find out if it’s even an option for you since not all lenders offer mortgage recasts. Most big-bank lenders offer mortgage recasting, but not all loans qualify, such as FHA or VA loans.
If you find that your bank does offer mortgage recasting, you will need to determine if you can financially swing a $5,000 or larger payment. If you can, a mortgage recast might be right for you. To help you decide whether it’s right for you, take a look at our list of the advantages and disadvantages of recasting your mortgage:
Pros of a Mortgage Recast:
- Lower monthly payments
- Less interest paid
- No need to re-qualify for a different loan
- In situations with a low-interest rate, you get to keep your rate
Cons of a Mortgage Recast?
- The length of your mortgage remains the same
- Less liquid cash
- Recasting fees
- In situations where you have a high-interest rate, you must keep that rate
Contact Sell Your OKC Home
If your mortgage payment is too much and a recast isn’t an option, Sell Your OKC Home can help. We want to help you avoid stressful situations, like foreclosure, by buying your Oklahoma City, Oklahoma, home. You don’t have to worry about spending your hard-earned money on renovations or repairs — you don’t even have to clean your property! We will pay you cash for your house as-is. Contact Sell Your OKC Home to get your fair, all-cash offer today.