What is an early termination fee?


Nick Bendel

Nick Bendel

( 1 min read )

Some lenders will make you pay a penalty, or early termination fee, if you pay off your loan ahead of schedule. This is to compensate them for the interest payments they don’t get to collect.


Related FAQs

There are four different ways you can get a car loan. You can go straight to a lender. You can get a finance broker to organise a car loan for you. You can get ‘dealer finance’ – which is when the car dealer organises a car loan for you. Or you can organise your own car loan through a comparison website, like RateCity.

Whichever method you choose, you will need to provide proof of identification, proof of income and proof of savings. So you may be asked for any combination of passport, driver’s licence, bank statements, payslips, tax returns and utility bills. You might also be asked to provide proof of insurance.

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