How we calculate

Methods, and why we chose them

Headline repayment

The standard annuity formula, repayment = P × r / (1 − (1 + r)^−n), with r the yearly rate divided by the number of repayments a year (12, 26 or 52). BNZ’s calculator does the same for monthly loans, and it reproduces the regulations’ $235.37 example.

Weekly and fortnightly

A true weekly or fortnightly repayment is the annuity worked out again with 52 or 26 repayments a year, which is what a bank sets. We show half (or a quarter) of the monthly repayment separately, because it is a different thing: it pays 13 monthly repayments a year.

Daily interest

Banks accrue interest daily and charge it monthly. Our daily option walks the loan day by day at the yearly rate divided by 365, adds the interest to the loan on the same date each month and takes each repayment on its own date. No bank page says whether leap years use 366 days, so we use 365 every year.

Where banks differ

BNZ has worked out interest on actual days in each repayment period since 5 May 2024 (28 to 31 days a month); its principal and interest repayment stays the same, but interest-only repayments vary by month. Other banks do not publish their exact method, and ANZ’s handbook figures ($877.67 a fortnight) are not reproduced by any standard method we tried.

Rounding

No bank publishes its rounding rule. We carry full precision, show repayments rounded up to the cent so the loan is always repaid within its term, and let the last repayment be smaller. The research figures we test against round half up, so a displayed repayment can be one cent above them.

Extra repayments and lump sums

Both runs use the same regular repayment. By default a lump sum keeps your repayment the same and shortens the loan; you can choose a lower repayment over the same term instead.

Refixing and split loans

At a refix the new repayment is the annuity on the balance left, over the years left, at the new rate. A split loan is worked out part by part.

Break fees

The safe-harbour formula in regulations 9 and 11 of the Credit Contracts and Consumer Finance Regulations 2004, with the bank’s current rate for the term nearest your time left (the higher rate if two are equally near). Banks use wholesale swap rates, so our figure is an estimate.

Default rate

For each term we take each bank’s lowest advertised rate across its products and average the five banks, to two decimal places. Banks without a term (Kiwibank has no 18-month rate) are left out of that term’s average.

Break fee formula

Value of the remaining repayments (reg 11)

VFP = p × ((1 − v^n) / (i / f)) × (1 + i)^(d / 365) + v^n × (1 + i)^(d / 365) × EB, where v = 1 / (1 + i / f) and EB = u + IC − TP

Estimate of the lender’s loss

LRE = VFP − u, and zero if that is negative

Where the rates come from

The rates table is read from interest.co.nz and dated 10 November 2026. We edit one file each week, rebuild and redeploy. A rate never appears on this site without its date.