Which is Better - Recasting vs. Refinancing Your Mortgage?
June 17th, 2016
June 17th, 2016
If you’re a homeowner who wants to save money on your mortgage, you’ve got several options. But you need to choose the one that best fits your financial situation. The two main choices available to many borrowers are recasting or refinancing their mortgage. Each option can help you lower your monthly mortgage payment and save money in interest costs.
In order to help you make a decision about which choice is right for you, here is some information you’ll need to consider.
Recasting Your Mortgage
With a recast, you would pay an additional amount of money toward your loan balance (typically, $5,000 or more). Depending upon your lender, you may pay this amount as a lump sum or as extra regular payments. Your lender would re-calculate your monthly payments based on the remaining loan balance.
Pros of recasting
Cons of recasting
Refinancing Your Mortgage
With a refinance, you replace your current loan with a new loan. Or, in others words, you use the new loan to pay off the old loan.
Pros of refinancing
Cons of refinancing
Which Should You Do?
If you need help determining which is right for your situation – a loan recast or a refinance – contact the experienced mortgage specialists at Grandview Lending in Indianapolis. They can help you review your current loan and run some numbers to calculate how much your loan payments would be for a recast versus a refinance. Contact them today at 866-690-4920.
Photo credit: 123RF / Natalia Merzlyakova
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