Recently the New York Times printed an interesting article on the concept of “recasting” as a means of lowering mortgage payments. From the article:
“A little-known strategy, called “recasting,” or “re-amortization,” is available through some mortgage lenders and servicers. It involves paying off a lump sum of the principal amount and asking to have the monthly payments reset according to the original interest rate and loan terms. The lump sum reduces the principal, so your new monthly payments decrease slightly and you save on interest paid over the life of the loan.”
One of the primary appeals of recasting is that it typically involves no (or a small) fee and doesn’t require the credit requirements of refinancing.
To learn about recasting (and perhaps help some of your clients who may be looking for ways to lower payments) check out the full article here.
(If the link is not working, cut and paste the following in your browser: http://nyti.ms/fdHPlN)
Posted on January 11, 2011
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