Definition of Scheduled recast:
Some mortgage programs allow homeowners to make early payments on loans that are not fully amortizing, meaning the payments don't reduce the principal balance owed. Later on, at the scheduled recast date, a new amortization or payment schedule is calculated based on the principal balance at that time and the remaining term (or time left to pay).
A scheduled recast is a recalculation of the remaining payment schedule of principal and interest payments for a mortgage. A mortgage is a type of loan in which a bank lends to a borrower for the purchase of a home. The recast is done on a predetermined or scheduled date.
Recalculation of payments on a mortgage. With some adjustable rate mortgages, payments during the first five years are kept low, sometimes not even covering the amount of interest owed. At some point in the mortgage, commonly after five years, payments are recalculated so that the mortgage can be paid off over its remaining term. At that point, payments may rise dramatically.
How to use Scheduled recast in a sentence?
- A scheduled recast is done on a predetermined date and ensures that the mortgage will be paid off by the end of its original term.
- A scheduled mortgage recast can be an alternative to refinancing since the recast is not a new loan, nor is a credit check needed.
- A scheduled recast is a recalculation of the remaining payment schedule of principal and interest payments for a mortgage.
Meaning of Scheduled recast & Scheduled recast Definition