What would it cost to break my fixed rate?
A rough break cost from today’s rates, set against what refixing would save, so you can see whether breaking is worth asking your bank about.
Mortgage break fee calculator
Weigh the cost against a longer fixed term or a switching incentive.Compare switching banks.
An estimate, not your bank’s figure. Banks calculate break costs from wholesale (swap) rates when you fixed and now, on the balance you repay early, and each uses its own formula; the advertised rate stands in for those here. Most allow some extra repayment each year without a break fee. Ask your bank for a break quote before deciding: it is free and changes daily with wholesale rates.
Questions
Why do banks charge a break fee?
When you fix, the bank funds your loan at a wholesale rate for the same term. If rates fall and you leave early, it has to re-lend that money for less, and the break fee recovers what it loses. If rates have risen, there is usually no break cost beyond an admin fee.
How is a break fee calculated?
Roughly, the difference between the wholesale rate when you fixed and the wholesale rate now for the time left, on the amount repaid early, over the months remaining, discounted to today. Each bank uses its own formula.
Can I avoid a break fee?
Wait until the fixed term ends, use your bank’s yearly allowance for extra repayments, or split the loan so only part is fixed. When selling and buying, many banks let you carry the loan to the new home.
Is it worth breaking my fixed rate?
The break fee usually takes most of what a lower rate would save over the same months. It can pay when you fix for longer than you have left at a low rate, or when a new bank’s cash incentive covers the cost.
More home loan tools
Mortgage repayment calculator
Weekly, fortnightly or monthly repayments and the interest over the loan.
How much can I borrow?
An indicative borrowing limit and a readiness check, from your own figures.
Pay off your mortgage faster
What extra repayments or a lump sum save.
Switching banks
Whether moving your mortgage pays, after every cost.
Buying your first home
The steps from saving a deposit to settlement day.
What could your KiwiSaver buy?
Your balance as a price, and homes at it in the suburb you pick.
KiwiSaver first-home withdrawal
What your KiwiSaver could put toward a deposit.
First Home Loan and low deposits
Buying with 5–20% deposit, and what it costs.
Mortgage pre-approval
What it is, what to bring, and how long it lasts.
Today’s mortgage rates
Every lender’s advertised rates, side by side.
Home loan affordability by town
What a median home costs against local incomes, town by town.
Find a mortgage adviser
Advisers and firms near you.