Prepayment Penalty Calculator

Calculate the prepayment penalty for Korean bank loans using the sliding-scale formula from standard lending terms. Enter elapsed months and penalty rate to instantly check penalty amount, remaining days, and exemption status.

Prepayment Penalty Result

Prepayment penalty

800,219₩

Remaining days: 730일
Elapsed days: 365일
Exemption period (days): 1,095일
Effective rate: 0.8002%

Formula · assumptions

Penalty = principal × rate × (remaining days / exemption period days).

Remaining days = max(0, exemption days − elapsed days). 0 = exempt.

Exemption period days = exemption years × 365.

Elapsed days = elapsed months × 30.4 (simplified: 1 month = 30.4 days).

Rates and exemption periods vary by bank, product, and origination date. Always verify with your bank.

What this tool does

The prepayment penalty calculator uses the sliding-scale formula from Korean bank standard lending terms (여신거래기본약관) to automatically compute the fee charged when you repay a loan in full or in part before its maturity date. The sliding scale means the longer you have held the loan, the lower the penalty: for a typical 1.2% rate with a 3-year exemption period, repaying immediately after origination incurs the full 1.2%, while repaying after 1 year costs about 0.8%, after 2 years about 0.4%, and after 3 years the fee is waived entirely. Enter the prepayment principal, penalty rate, elapsed months, and exemption period to instantly see the penalty amount, remaining days, and exemption status. This tool is ideal for anyone considering refinancing (대환대출) or planning an early repayment after receiving a lump sum.

Who uses this

Check the prepayment penalty before refinancing (switching banks or loan products)
Decide the optimal timing for early repayment when a bonus or property sale proceeds arrive
See how many days remain until the penalty exemption kicks in (usually 3 years)
Compare the actual penalty amount across different bank penalty rates
Plan renewal timelines for jeonse loans, mortgage loans, or personal credit loans

How to use

1Enter the prepayment principal — the full remaining balance for full repayment, or the partial amount you plan to repay.
2Enter the penalty rate (%). Check your loan agreement or bank app; typical range is 0.5–2%.
3Enter the elapsed period in months — the number of months since the loan origination date.
4Enter the exemption period in years. Most Korean banks use 3 years; check your agreement.
5Read the result: penalty amount, remaining days until exemption, and effective rate.

Sliding-scale formula

Penalty = principal × rate × (remaining days / exemption period days) Remaining days = max(0, exemption days − elapsed days) Exemption period days = exemption years × 365 Elapsed days = elapsed months × 30.4 (simplified: 1 month = 30.4 days) Example: ₩100M principal, 1.2% rate, 12 months elapsed, 3-year exemption → Elapsed days = 12 × 30.4 = 364.8 → Remaining days = 1,095 − 364.8 = 730.2 → Penalty = 100,000,000 × 0.012 × (730.2 / 1,095) ≈ ₩800,219

Calculation examples

Immediate repayment (0 months elapsed)

Principal ₩100M, rate 1.2%, 3-year exemption. Remaining days = 1,095. Penalty = ₩1,200,000 (full rate). This is the worst-case scenario for switching loans — waiting until the exemption period reduces the cost significantly.

Repayment after 1 year (12 months elapsed)

Principal ₩100M, rate 1.2%, 3-year exemption. Elapsed days = 364.8, remaining days = 730.2. Penalty ≈ ₩800,219 — about 33% less than immediate repayment. The sliding scale reduces the burden as time passes.

Repayment after 3+ years — fully exempt

Principal ₩100M, rate 1.2%, 37+ months elapsed, 3-year exemption. Remaining days = 0. Penalty = ₩0. Under standard Korean bank lending terms, once the exemption period (usually 3 years) has passed, the prepayment penalty is fully waived.

Frequently asked questions

What is a loan prepayment penalty?

A prepayment penalty (중도상환수수료) is a fee charged by the bank when you repay a loan before its maturity date. Because the bank loses expected interest income, it compensates by charging a percentage of the repaid amount. The fee typically slides down to zero over 3 years.

Where can I find my penalty rate?

Check your loan agreement (약정서), the loan details screen in your bank's app, or call the bank's customer center. Rates typically range from 0.5% to 2%. Internet-only banks like Kakao Bank or Toss Bank often charge no prepayment penalty.

Is the penalty really zero after 3 years?

Under the standard Korean bank lending terms (여신거래기본약관), the prepayment penalty is waived once 3 years (1,095 days) have elapsed since origination. However, some products may use different exemption periods — always verify in your specific loan agreement.

Why might the calculator differ from my bank's actual fee?

This calculator simplifies elapsed days as months × 30.4. Your bank calculates exact calendar days from origination to repayment. Some products may also use different methods (e.g., deducting from the remaining principal). Always confirm the exact fee with your bank before repaying.

How do I compare the penalty against the savings from refinancing?

Compare the prepayment penalty against the annual interest savings from the new lower rate. For example, if the penalty is ₩800,000 and the new loan saves ₩1,200,000 per year in interest, you break even in less than a year. Use the Loan Calculator to compare total interest under both loans.

How is a partial prepayment penalty calculated?

The penalty applies only to the amount you actually repay early. Enter the partial repayment amount (not the full loan balance) in the principal field to calculate the penalty for that specific amount.

Cautions

•This calculator uses a simplified model (elapsed days = months × 30.4) and may differ from your bank's exact calculation based on calendar days.
•Internet-only banks (Kakao Bank, Toss Bank, etc.) may charge no prepayment penalty — check your agreement.
•Fixed-rate and variable-rate loans may have different penalty rates; promotional products may have special conditions.
•Always confirm the exact fee with your bank before making an early repayment decision.