Prior to putting a lump sum towards your home loan, comprehend your choices - what is the best rate for mortgages. Home loan recasting is when a loan provider re-amortizes the loan after the homeowner makes a large swelling amount payment. In order for your payment to change, the loan needs to be reamortized to show the lower primary balance. Assume you purchase a home and secure a 30-year $500,000 loan at 3% interest.In 5 years, you have additional money and decide to put $100,000 towards your home loan. Without recasting your mortgage, your payment remains the exact same as the amortization schedule is still based on the original $500,000 home mortgage, however the lump amount payment permits you to settle the loan much quicker: in about 22 years instead of 30 - what kind of mortgages do i need to buy rental properties?.