Before putting a swelling amount towards your home loan, comprehend your options - the big short who took out mortgages. Home loan recasting is when a loan provider re-amortizes the loan after the homeowner makes a large lump sum payment. In order for your payment to alter, the loan needs to be reamortized to reflect the lower principal balance. Presume you purchase a house and secure a 30-year $500,000 loan at 3% interest.In five years, you have extra cash and choose to put $100,000 towards your mortgage. Without recasting your home mortgage, your payment remains the exact same as the amortization schedule is still based upon the initial $500,000 mortgage, but the swelling sum payment allows you to settle the loan much quicker: in about 22 years instead of 30 - what is the interest rate today on mortgages.