You can have your home mortgage “recast” if you make a single large lump sum toward the principal mortgage balance. So consider taking your big tax refund and putting it toward the mortgage principal to help reduce your monthly payment. And a recast is FREE. You don’t need to refinance to reduce your payment!
Each lender has a different minimum principal payment requirement. For instance, Wells Fargo will do a recast for a minimum of $20,000; Chase is just $5,000. The recast process takes about two weeks.
Note: A recast is not a reduction in your mortgage interest rate. It’s a reduction in your monthly payment.
To get started give your lender a call to see what their minimum payment is to have your mortgage recast. I’ve just begun the process with Chase. I’ll let you know how it goes!