PennyMac will ensure that all loan recasts will be reviewed in accordance with state and/or federal laws and loan terms.The re-amortization is calculated on the remaining principal balance after the principal curtailment is applied to the loan. An agreement must be executed by all borrowers and by PennyMac on behalf of the investor.
Recast Loan Eligibility Requirements:
Generally the loan must meet the following guidelines for eligibility:
· The loan payments must be current, with the exception of loans impacted by a natural disaster or participating in a Hardest Hit Funds (HHF) program
· A Prepayment Penalty does not exist on the loan, unless the customer meets the terms of the prepayment penalty and is willing to pay the penalty prior to the recast.
· Principal Curtailment amount must be at a minimum of $10,000.00
· The loan must be at least 90 days from the origination date. (Can be done sooner than 90 days, once the loan has been pooled)
· No late payments reported in the last 12 months
· Principal recast is subject to investor guidelines and approval when applicable
Recast Fee: $250.00
· Delinquent loans 30 days or more
· A loan that has a Prepayment Penalty, unless the customer would like to pay for the penalty in order to process the recast.
· Home Equity Line of Credit (HELOC)
· Interest only Loans
· Investors that do not allow a recast
· Principal payments less than $10,000 [or % of loan balance]
Note - Government and Jumbo loans are not eligible
Recasts not allowed unless large principal payments is made.**