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Finance & Banking vocabulary · Loans & Credit

Early repayment

Meaning in finance & banking, with examples

nounCommon term

In finance & banking, early repayment means: Paying back all or part of a loan before the dates set in the contract, which reduces the total interest the borrower pays.

In Turkish: erken ödeme, erken kapama, vadesinden önce ödeme

How it is used

Used in loan contracts and customer service. Customers make a partial or full early repayment; 'prepayment' means the same. Some loans carry an early repayment charge to cover the lender's lost interest. For consumers, the rules on such charges are set by consumer protection law and differ by country and loan type.

Example sentences

  1. If you make an early repayment, your remaining instalments will be recalculated.

  2. Is there an early repayment charge if I close the mortgage next year?

Common collocations

  • early repayment charge
  • make an early repayment
  • partial early repayment
  • prepayment penalty
  • repaymentThe act of paying back money you have borrowed, or one of the regular amounts you pay to do this.
  • pay offTo pay back the whole amount of a debt, such as a loan, mortgage or credit card balance, so that nothing more is owed.
  • mortgageA long-term loan used to buy a home or other property. The property secures the loan, so the lender can have it sold if the borrower does not repay.
  • refinanceTo replace an existing loan with a new one, usually to get a lower interest rate, a longer term or different conditions.
  • principalThe original amount of money borrowed or invested, not including interest. Each loan payment usually covers some interest and some principal.

More terms: Loans & Credit

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This page explains English vocabulary for learners. It is not financial advice.