Just how much you have to pay in the form of exit fees depends on the kind of loan you have. In any case, expect to pay discharge fees, which lenders charge to cover administrative costs (see the table below). If you have a fixed rate loan and want to exit early, you can expect your lender to charge a break fee.
Break fees, also known as break costs or early repayment fees, depend on multiple factors like the original loan amount, outstanding balance, how much time remains on the fixed term and the prevailing interest rate. The higher the outstanding balance, the higher the break costs. The same also applies with the remaining loan term. When it comes to the interest rate, lenders compare the interest rate of loans with the prevailing interest rate—if the prevailing interest rate is lower, expect to pay break costs.
Break costs often come into the picture if you want to leave your home loan when there's a better deal, or if you make too many additional repayments on your home loan. Even if you're not leaving your loan to refinance, there are many reasons you might leave your home loan, such as moving overseas or interstate, accepting sudden profitable offers from buyers or receiving a substantial increase in income.
Irrespective of the reason, knowing just how much you have to pay in the form of break costs can help you make an informed decision about your home loan. Remember that there's no standardised break fee and you can ask your lender ahead of time how much you might have to pay if you choose to repay your loan sooner than scheduled.