How to use this tool
1
Enter your Loan Balance and the Time Remaining on your fixed term.
2
Input your Current Fixed Rate and the New Bank Rate for the remaining term.
3
(Optional) Adjust Wholesale Margin. 1.5% is a safe estimate for bank profit.
Loan Details
$
Interest Rates
%
%
1.50%
Subtracts from retail rates to guess "Hedge Rate".
Estimated Break Fee
$0
Likely $0 (Rates have risen or stayed flat)
Napkin Calculation
$0
Complex Calculation
$0
Why the difference? The complex formula saves you money because it "discounts" future payments.
Technical Breakdown
Orig. Hedge Rate (Est):
0.00%
Curr. Hedge Rate (Est):
0.00%
Rate Diff (Loss):
0.00%
How to interpret your results
Estimated Break Fee: This is your target number. It simulates the exact formula NZ banks use (Discounted Cash Flow).
Napkin Calculation: This is a rough estimate (Loan × Rate Difference × Time). Use this as your "Worst Case Scenario" cap.
If the Result is $0: Rates have likely risen or stayed flat. The bank is not losing money, so they cannot legally charge you for "Economic Loss".
Disclaimer: This tool is an estimate only. It cannot calculate the exact fee because banks' internal wholesale rates are secret. Only your bank can provide the exact number, so you should request a formal quote from them before making any financial decisions.