Paying off a loan early - penalties?

If you have a Northern Rock mortgage surely the easiest and most accurate way of knowing in your particular case is to ring them up and ask them. They won't kill you. They may even offer you something better if they sniff that you might move away.

Rob Graham

Depends what kind of loan it is. If it's a mortgage, the terms are likely to be very clear and well known to the borrower who can be bothered to read the paperwork. Typically, if it's not a discounted interest rate deal, it's likely to be penalty-free. Otherwise, typically 6 months' interest on the amount repaid.

If it's a personal loan, typically with a 12 to 60 month term, the penalty is likely to be 1 or 2 months' interest, computed according to the rule of 78.