recast mortgages? (loan, approve, refinance, loan)

[candlestix]

Does JP Morgan Chase bank actually allow recast of mortgages? I found a pdf with limited information. When I take out my loan I plan on prepay often and wondered if recasting would be to my benefit, each time I do a recast the amount of prepayment applied principal goes up?

"Recast Modification

If you make a large principal balance reduction and we agree to modify your loan so you can lower your monthly payments. Your account must be in good standing."

under cost table "$ 0"

[Pfhtex]

I would think that asking them might be a good move.

[chet everett]

There is a world difference between "we agree" and "we shall"...

In my experience lenders idea of "large principal balance reduction" is open only to THEIR standards, which are basically driven by their best guess as to how likely you are to do something like drop down from a jumbo to a conforming mortgage and /or refinance from a 30 to a 15 rather than any specific threshold...


The problem is "asking them" -- the phone people won't be able to answer this directly and even if they did this is the kind of thing you would want to HAVE IN WRITTING which of course they can't do... Even if you talk to somebody at a physical branch they will say "somebody at Corporate has to approve". Who? God only knows...

[candlestix]

update I spoke to someone at Chase customer service, you can recast with a $5000 payment towards the loan, then again this was customer service and not at all in a written format...

[TimtheGuy]

Originally Posted by candlestix

Does JP Morgan Chase bank actually allow recast of mortgages? I found a pdf with limited information. When I take out my loan I plan on prepay often and wondered if recasting would be to my benefit, each time I do a recast the amount of prepayment applied principal goes up?

"Recast Modification

If you make a large principal balance reduction and we agree to modify your loan so you can lower your monthly payments. Your account must be in good standing."

under cost table "$ 0"

Is your objective to pay the loan off faster and save on interest paid, OR to keep your payments as low as possible after a principal reduction? If it is to payoff the loan faster, there is no benefit in recasting.