Mortgage Recast Minimum Lump Sum: How Much Do You Need?

Before you can recast your mortgage, you need to clear your lender’s minimum lump-sum requirement. Pay less than the minimum and your extra payment just reduces your balance without lowering your monthly payment. So how much do you actually need? Here’s the full picture.

The typical minimum

Most lenders require a minimum lump sum of $5,000 to $10,000 to trigger a recast. The exact figure varies by servicer:

• Some lenders set a flat dollar minimum (commonly $5,000 or $10,000)
• Others require a percentage of your principal balance (for example, 10%)
• A few use whichever is greater

For reference, UWM requires a $5,000 minimum, while some servicers set the bar at $10,000. Always confirm your specific lender’s threshold: it’s the single most important number to nail down before you plan a recast.

Why there’s a minimum at all

Recasting takes administrative work: the servicer has to re-amortize your loan and issue a new payment schedule. Lenders set a minimum so the lump sum is large enough to make a meaningful dent in your balance and justify processing the request. A $1,000 payment wouldn’t move your monthly payment enough to be worth the effort on either side.

How much should you actually pay?

Meeting the minimum gets you a recast, but the size of your lump sum drives how much you save. The bigger the principal reduction, the lower your new payment and the more total interest you avoid.

Here’s a simplified illustration on a $350,000 balance at 6.5% with 25 years remaining (your actual numbers will differ):

Lump sum	Effect on monthly payment
$10,000	Modest reduction
$30,000	Noticeable reduction
$50,000+	Significant reduction

The relationship is roughly proportional: doubling your lump sum roughly doubles the payment reduction, all else equal.

Don’t drain your safety net

Just because you can put $50,000 toward a recast doesn’t mean you should. Remember that money paid into a recast is locked into your home equity, and you can’t easily pull it back out. Before committing a large lump sum, make sure you’ve kept:

• A solid emergency fund (3–6 months of expenses)
• Cash for any near-term big expenses
• Any high-interest debt paid off first (credit cards at 20%+ beat a mortgage payoff every time)

If you’re torn between recasting and keeping the money invested, our recast or invest guide breaks down the tradeoff.

What the lump sum doesn’t change

No matter how large your lump sum, a recast keeps your interest rate the same and your payoff date the same. It only lowers the monthly payment. If you want to shorten your loan instead, you’d make extra payments without recasting. See recast vs extra payments.

Putting it together

The minimum to recast is typically $5,000–$10,000, but the right amount for you depends on your goals, your cushion, and how much the payment reduction is worth.

The fastest way to decide is to run the calculator with different lump-sum amounts and watch how your new payment and total interest saved change. Then, once you’ve settled on a number, follow our step-by-step recast guide and confirm your servicer’s exact minimum on the lender recast policies page.