As I mentioned above, the legislation that came into force in 2019 set limits on the maximum fees for early payment or cancellation. These limits are shown in the table below. Under no circumstance can the fees charged for a change from variable to fix rates or for early repayment on fixed interest loans exceed the financial loss to the lender.
Maximum Fees for: | Life of the Loan (years) | Fee (a) (%) |
Change from Variable to Fixed Rate | 0-3 | 0.15 |
3-5 | 0 | |
Over 5 | 0 |
Early Repayment on Fixed interest Loans | 0-10 | 2 |
Over ten | 1.5 |
Early Repayment on Variable Interest Loans | Life of the loan (years) | 3 years * | 5 years * |
0-3 | 0.25 | 0.15 | |
3-5 | 0.0 | 0.15 | |
Over 5 | 0.0 | 0.00 |