It depends on the terms of the lender whether there are any penalties for repaying the zero interest loan earlier than agreed. Certain lenders tend to charge the borrower prepayment penalties; however, certain lenders have more relaxed terms, and encourage the borrower to repay the loan earlier than expected. Understandably, before making the decision to repay the loan, the borrower must go through the fine print of the loan agreement in order to know the penalties, if any.