Recast trigger
Recast trigger
Recast trigger is a predefined event that will reset payments on a negative-amortizing mortgage loan so that the mortgage converts to a fully amortizing structure. Mortgages that allow for negative amortization, such as Option ARMs, will have defined recast triggers. Usually, there'll be a recast trigger date and a recast trigger amount. If the loan balance rises to a certain level, the mortgage automatically converts to fully amortizing payments. Otherwise, the loan will convert at the recast trigger date.
5.90
