Early Termination Fees: A Guide to Ending Your Phone Contract Early

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This article forgot the most easiest way to do it. Most providers will price match other providers. Most providers will have a sign up for 2 years now and get "x" amount of dollars off. These credits can be several hundred easily, so all you have to do is find a current offer by any major provider, then call your existing provider and ask for a price match. You should the get the other companies discount and it will hopefully offset the e.t.f. I used to use this tool to sign people up, for a cell phone provider locking a person into 2 years if worth thousands, so hundreds is worth it to take your business!

It Can Cost $700 to Return a Phone

The following is based on a true story. Names and locations have been changed to protect the identity of the parties involved.

Jane was one of the hundreds of people who lined up in front of the XYZ store on the launch date of the iPhone 4. She had waited months for this phone, and had been on the waiting list weeks before it was released in Canada. She was also very determined, and stood in the scorching summer heat before finally getting in the store. Fifteen minutes later, she was out of the store with a brand new iPhone.

Two weeks after she got the phone, she started having problems. The phone would frequently power off on its own, even while plugged into a charger. So she visited XYZ store again.

There was a different sales representative in the store that day.  After hearing her problem, he went to the back room for a few minutes, and came out with a brand new iPhone 4.

“This is the only iPhone we have left,” the sales representative said. “Because this is a brand new iPhone, my system won’t let me just exchange the phones. But I can activate it on the new number, and give you the same plan you had before. Don’t worry, you’re still within the return policy, and once you return the phone, your previous contract will be canceled, and you won't have to pay anything.”

Jane was hesitant, but reluctantly accepted.

About a month later, Jane came home to find two bills from her cell phone provider. One was for her current phone, and the other for the phone that she had returned. Confused, she called customer service. After some investigation, the customer service representative told her that there is over an hour of usage on the original phone, and therefore the phone was not returnable.

Panicking, Jane quickly visited XYZ store again. This time, she had the store manager look into the matter, and discovered that the employee that had activated the new line no longer worked for the company. Worse, the phone Jane returned is nowhere to be found.

Now frustrated, Jane calls the customer service line again, demanding that the company stop billing her for the phone she returned or she will cancel all her services with the company. She was then told that it would cost her around $700 to cancel each cell phone line.  After battling with the representative on the phone for half an hour, the representative finally relented, and reduced the charges on the non-existent cell phone line to $20 per month to ride out the contract.

To this day, Jane is still paying $20 per month for a cell phone that she doesn't own.

So what's the moral of the story?

1. Try the technical help line first – Many times, device issues can be solved from the comfort of your own phone. All major cell phone companies have their own technical help line to help you troubleshoot the phone and determine if the device requires repair. Jane’s problem could have possibly been solved by simply performing a software update on the phone.

2. Know your warranty – Almost all phones have a one year warranty in which you can send the phone back for repair as long as the phone is not physically damaged or endured liquid damage. iPhone clients can even visit the Apple Store for repair. So Jane’s problem could have been avoided by simply visiting an Apple Store.

3. Know your company’s return policy – Most cell phone companies have a “buyer’s remorse” policy, a period in which they can back out of a contract commitment. For mobile phones in Canada, this is usually around 15 days from the original time of purchase, and if the phone has less than 30 minutes of usage (Check your provider’s terms of service before signing the contract.)

A store agent would usually let you know if your phone is within the buyer’s remorse policy. Jane, unfortunately, had a run in with a shady dealer who decided to activate a new line for her so he could earn a higher commission, but he wouldn’t have been able to pull it off if Jane knew about the buyer’s remorse terms.

4. Why do I need a new number? – If you can’t answer this question, then you probably don’t. Sales agents earn a commission for each new cell phone line they activate, so some would go out of their way in securing these activations, even by acting against your best interest.