Rule of 78 Early Repayment Calculator

When applying for a personal loan or car loan in Hong Kong, many loan contracts state that if the borrower repays early, the lender will calculate the refundable interest using the \"Rule of 78\". The Rule of 78 is an interest allocation method that distributes the total interest over the repayment period in decreasing instalments, so earlier payments contain more interest and later payments contain less. This means that even if you settle the loan early, the interest already paid may not be refunded proportionately, and the bank or finance company may charge a substantial early repayment fee.

For Hong Kong borrowers, understanding the Rule of 78 is important because it directly affects the actual interest savings from early repayment. Advertisements often claim \"no penalty for early repayment\", but under the Rule of 78 the refundable interest can be much lower than expected. This is especially true once the loan has passed the halfway point of its term, because little interest remains to be refunded, making early settlement less worthwhile.

HK FinBox 的 78 法則提早還款計算機，能夠幫助你輸入貸款額、年利率、還款期數及已還期數，自動模擬剩餘本金、已付利息、應退利息及提早還款手續費。計算機採用香港常見的「78 法則」攤分方式，讓你在幾秒內評估是否真的值得提早還款。

In practice, confirm with the lender whether your contract uses the Rule of 78 and what early repayment fee applies. Then enter the details into the calculator and compare the total cost difference between continuing with monthly payments and settling in a lump sum. If the difference is small, you may be better off keeping cash as an emergency reserve; if the difference is significant and you have sufficient liquidity, early repayment can help reduce debt.