ActuarialWhen the term “ACTUARIAL” is applied to lending, it refers to a method of calculating a rebate or refund of precomputed finance charges. Rebates for early termination are as a general rule more favorable to the borrower if actuarial method is used, however in Australia the more favorable method used is called “Rule of 78”. (Particularly in respect of Motor Vehicle finance)
OUR FINANCIERS USE
BMWRule of 78
CBA & WESTPACContract implicit rate discounted by 2%. (in Westpac scenario they also add a “break cost” of approx $200)
B of QStandard method. Contract implicit rate discounted by 2% plus 1 or 2 payments dependent upon reason for termination
B of QPlatinum discounted. “Rule of 78” plus a “break cost” of approx 1/2 one monthly installment.
ANZ & ESANDAA discount Rate applies. Equal to but not less than 70% of the rate implicit in calculating payments. Plus $200.00 (e.g. contract rate say 8% @ 70% = 5.60%)
CAPITALA discount Rate applies. Equal to but not less than 70% of the rate implicit in calculating payments.
MACQUARIEContract implicit rate discounted by 4%.

Disclaimer: Please note the above lenders, rates, and fees are indicative only and should only be used as a guide. Firm rates, and fees can only be quoted by the financier at the time of early payout.