I currently own my home (paid off) and will be moving. The plan is to purchase a home in a new city and then I will sell my current home.

On the purchase I will put down enough to clear PMI.

Once my current home is sold and the money clears I intend to use it to pay down my loan on the new home. At this point I should owe ~ 50k.

Is there a way to reduce my monthly payment to reflect the 50k remaining rather than the couple hundred initially borrowed?

Edit: Forgot to mention I have no issue with renting a place for a few months if it would be financially an advantage, not optimal but I could do it if it was worth it.

This post was edited on 2/6/25 at 11:23 am

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Posted by Rize

Spring Texas

Member since Sep 2011

17437 posts

Posted on 2/6/25 at 11:21 am to computerguy

You can do what’s called a recast.

Make sure to read the fine print on fees and that it goes towards paying down the principal. It’s much cheaper than a refi and you keep the same interest rate and terms.

Fees probably range from $250 to $500 from what I remember.

This post was edited on 2/6/25 at 11:24 am

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Posted by computerguy

Orlando

Member since Oct 2007

1256 posts

Posted on 2/6/25 at 11:25 am to Rize

Thanks this is precisely what I was looking for.

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Posted by npt817

Prairieville, LA

Member since Sep 2010

1610 posts

Posted on 2/6/25 at 11:43 am to computerguy

Yep, Rize is correct in that you want to do a recast after the sale of current home. Just check with your lender on what terms are for their recast. Sometimes they have timeframe requirements in place.

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Posted by computerguy

Orlando

Member since Oct 2007

1256 posts

Posted on 2/6/25 at 12:42 pm to npt817

Thank you npt817 I will ask about the terms and timeline, this is a good point. Much appreciated.

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Posted by TigerintheNO

New Orleans

Member since Jan 2004

42901 posts

Posted on 2/6/25 at 4:15 pm to computerguy

quote:
I currently own my home (paid off) and will be moving. The plan is to purchase a home in a new city and then I will sell my current home...

]Forgot to mention I have no issue with renting a place for a few months if it would be financially an advantage,

I will be in the same boat looking to move in ~2 years, we are thinking about renting for the first 6 months - year, then purchase a house.

First, I will know exactly how much we cleared on the sale of our house.
Secondly, it will give us some time to see where in the new city we want to live.

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