Mortgage Recasting vs Curtailment Comparison 2027

Compare mortgage recasting (resets monthly payment) vs curtailment (keeps payment, shortens term) 2027 — different math, different goals.

Recast Mechanics

Make lump-sum extra payment. Lender RECALCULATES new (lower) monthly payment based on remaining balance + remaining term. One-time fee $150-500.

Curtailment Mechanics

Make extra payment, keep same monthly payment. Future payments still come out at original amount but have MORE going to principal (lower balance = less interest).

When Recast Wins

Job loss expected. Want cash flow flexibility. Income tighter. Lower payment = stress relief.

When Curtail Wins

Mathematically saves more interest. Faster payoff. Total cost lower. Discipline-friendly (forced higher effective payment).

Source: fanniemae.com Selling Guide B2-1.4-04, cfpb.gov mortgage. Last updated: May 2026.