Glossary
Break fee / early repayment fee
A fee some lenders charge when you pay a loan off before the end of its term, including when a refinance pays it off. Many NZ loans charge little or nothing.
By Leverage Finance · Updated 17 July 2026
Fixed-rate loan contracts sometimes include a charge for early full repayment, to cover the lender's admin and a portion of the interest they were expecting. Under the CCCFA the fee must be a reasonable estimate of the lender's actual loss, not a penalty. So on car loans it is often modest, and on many loans it is zero.
Yours is in your loan contract, and your lender must tell you the exact payout figure (balance plus any break fee) if you ask. That one phone call turns the biggest unknown in a refinance into a known number.
Our guide to break fees and early repayment charges covers how to find yours and how it changes the switching maths.
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