Thinking of giving your cell phone provider the axe? Unsure if its possible or what to expect?
Not to worry. In this guide, we’re going to show you the best ways you can get out of your cell phone contract so that you can find something new without putting a huge hole in your finances.
We’ll start with general tips and then break things down for special scenarios or locations where other options might apply.
NOTE: This guide is packed with tips & tricks on how you can break free of your contract to save - and it's free. Our team puts together a guide just like this one each week and you can receive it for free to your inbox when you sign up for our weekly newsletter.
Table of Contents
The Infamous Early Termination Fee
Other Cancellation Fees
Reasons to Terminate Your Cell Phone Contract
Reducing Costs without Cancelling
Getting Out of Your Contract without Getting Out Your Wallet
Transferring Your Contract
Selling Your Used Mobile Devices
Additional Tips and Tricks
Special Notes for Canadian Readers
Resources and Links
While having a phone in your pocket that's more powerful than the computers that sent us to the moon is awesome, our sleek smartphones come at a price. Often to the tune of hundreds of dollars.
To help offset costs--and lure in customers--many carriers will cut the price on their phones and lock you into an agreement. You get a massive discount on a phone and you pay it back over the course of a few years.
In other words, that smartphone you thought was $0 wasn’t so free after all.
Now imagine that after a few months, you’ve noticed you can’t place calls from your office, your phone isn’t quite what you expected or that you simply don’t use it as much as you thought you might. So you call up to figure out your options and out comes the three most dreaded words in cell phone terminology--Early Termination Fee.
Phone carriers would like you to believe that you have two options: Either you keep service until your contract is up or fork over hundreds of dollars to go elsewhere. Fortunately, this isn’t the case.
Not only do you have options to get out of your cell phone contract, but many of them are quite simple as well.
Before we get into the details, keep in mind that not every cancellation fee is an Early Termination Fee.
Many carriers are starting new programs centered around device payment plans. Instead of getting a discount and long-term contract, you pay a small monthly fee in addition to your service fees until the cost of the phone is paid off. It’s no different than a car payment or a mortgage. You’re just financed through the phone provider.
In most cases, if you cancel and do not or are not able to return the phone in like-new condition, you will be charged the remaining cost of the device plus fees. This is different from an Early Termination Fee. While you might not be able to use all of the follow tactics to avoid these specific fees, you should still find the information great for reducing the overall costs of cancelling.
Why you want to cancel your contract will have a big impact on the strategies that you can use to get off the hook. The list of reasons for why you might want to get out of your contract could go on for days.
The important thing is determining whether or not your reason justifies nullifying a legally binding contract.
A few of the most popular reasons (legit or otherwise) include:
- You’re not happy with your service
- You cannot afford the cost of service
- You’re looking for a new device or carrier
- You’re planning to relocate
- You’re not using your device as much as you had anticipated
- You’ve experienced a life change that requires altering or cancelling your plan
While there are plenty of legal and effective options for getting out of your cell phone contract, there needs to be a legitimate reason if you expect the process to proceed smoothly.
In most cases, you cannot simply phone up a service representative and say you just don’t feel like having their service. Though, even then, you’ll still find a few options that might work.
Options to Consider Before You Cancel Your Cellphone Contract
Before jumping in headfirst into calls or trading contracts, there are a few things to consider. The most important thing is figuring out exactly how much you would need to pay in Early Termination Fees. If you only have a single line and you’re near the end of your contract, the total might not be as fearsome as you’d think.
Most countries require service providers to provide you with the formulas for calculating your ETF. In most cases, it starts at a specific total and the fee is decreased by a certain amount with each month that you keep your bill in good standing. Specifics can change based on when you signed your contract, what types of devices you have and even your payment history.
If you’re unsure how to figure this out, calling your provider is often the easiest and most accurate option available. They are required to help you assess any fees to help you make an informed decision before you cancel.
Should you find that your fees are low, here are a few additional options to consider offsetting the cost of cancelling your phone contract.
Whether you signed up during a promotion or simply didn’t know exactly what you needed, it’s very common to find that you don’t actually use all of the data, minutes or features that you’re paying for each month. If you’re near the end of your contract, it might be cheaper to simply drop your service plan to the lowest rate possible and continue to pay for a few months.
Some carriers do require a base-level of service or a minimum monthly charge to count toward reducing your ETF. So if you’re going to try this trick, you might want to call your provider to ensure there are no unexpected complications.
Placing a Hold On Your Service
If you’re happy with your service but simply cannot afford it--or if you’re taking an extended vacation--many carriers will allow you to place a hold on your account or place it into vacation status. How this works will differ between carriers. If you’re looking to keep the clock ticking on your ETF, be sure to ask before agreeing to any terms as many carriers will not deduct from your ETF without a monthly payment.
We’ve scoured the Internet and discussion boards and looked over contracts from popular providers around the world. Here you’ll find some of the best tools at your disposal for getting out of your cell phone contract.
Even using these methods, you’ll still need a little persistence. Don’t be afraid to try a few different options. If you’re calling or writing to your service provider, be sure to keep notes on who you talked to and any options discussed. This can help to further your case if things drag on. However, with a little time and effort, you should soon be saying goodbye to that pesky contract and keeping a substantial chunk of change in your wallet.
Use Lackluster Service to Cancel Fee-Free
One of the most straight-forward options for getting out of your contract is proving that the service you’re paying for is unreliable. While it might take a little time, you should make a point to log any dropped calls, undelivered messages or service outages. Report them periodically to your carrier to establish a record of events.
If you need to, make a point to use your device more in areas where coverage is weak. We’re not talking about going to the next town or anything. You probably have a few spots around the house that seem to be black holes for cellular signals. Use them to your advantage. If you can find a few areas around places you commonly visit, this will help if your carrier proposes to resolve the problem with a femtocell tower or other fix.
Once you have proof of inconsistent service over the course of a couple weeks, get customer service on the line and see what they’ll do for you. Keep in mind that some carriers might require further analysis from an engineer or other source. While this won’t cost you anything, it might put a kink in the plan if the only place that calls drop is in the upstairs closet.
For US readers, if you feel you have presented a valid case and still are not getting results, filing a claim with the Better Business Bureau (BBB) and Federal Communications Commission (FCC) could help get the process moving along.
Canadian readers should consider filing a complaint with the Commissioner for Complaints for Telecommunications Services (CCTS). This step alone has proven one of the most successful in comments on our previous guide and various forums and discussion boards across the Internet.
Invoke the Material Adverse Clause
Most contracts are covered universally by what’s known as the Material Adverse Clause. This clause allows you to terminate a contract with no penalty should the terms and conditions of the contract changes and you don’t agree to the changes. Objections must be made within 30 days to be valid.
For mobile service contracts, there are certain aspects that are not covered. One of the biggest being taxes. Unfortunately, the carrier has no control over this. However, increased text messaging fees, changes to late payment fees or other items are fair game. Keep an eye on your bill and read any additions and pounce the moment that you get the chance.
It might require escalation to a supervisor, as many service reps aren’t educated on these legal loopholes, but with persistence, this is one of the most effective tools at your disposal.
Most cell phone carriers don’t care who’s paying the bill so long as there’s someone to call when the money doesn’t come in. If you’re looking to avoid jumping through loopholes or dealing with customer service, all you need to do is find someone willing to assume your contract. Once the contract is transferred, you are clear of any liability and obligation.
This is quickly becoming one of the most popular ways to get out of your cell phone contract. Buyers get the convenience of a short-term contract, you get to walk away with no repercussions and the carrier still gets their money each month. It’s a win-win-win. Numerous websites have popped up around the world to help buyers and sellers work out deals and streamline the process.
A few of the most popular choices include:
Reviews indicate that sellers seem to have the best luck when they include a phone with the deal. If you’re still not having much luck, many of the sites allow you to sweeten the deal with a small cash incentive.
While you might have to pay a small fee to list and another when the deal closes, this is substantially cheaper than most ETF fees. If you’re planning to find service with another provider, many sites also offer a discount on fees if you buy a contract after selling your own.
If you’re not looking to switch to another provider and bring your device with you--or you’re moving to an area where your device will no longer function--you might find that you can sell the handset or tablet and recoup the costs of the Early Termination Fee. If you’ve upgraded recently and happen to have a flagship device, you might even make a little profit.
Popular websites for selling used mobile devices include:
Call for Backup
Recently, there have been a few companies showing up that offer assistance in getting out of your phone contract. Whether it’s finding legal loopholes or helping prove that you’re not receiving the services outlined in your contract, these companies are willing to perform many of the steps outlined in this article on your behalf. You’ll pay a small fee for the convenience of letting someone else handle all the questions and paperwork. However, this still pales in comparison to the cost of many ETF arrangements.
One popular option is CellBreaker. They offer a variety of solutions, from monitoring your service agreement for changes to a full-service negotiation of getting out of your cell phone contract. Each has their own price tier. Their site outlines many of the finer details. Getting started is free. That makes it a great way to get an idea of what your options might be without any major investments.
Let Another Carrier Front Your Early Termination Fee
From the latest network technologies to exclusive deals on handsets and tablets, carriers are in a constant race to win your business and lock you into a contract. One of the latest tactics is paying customers to switch from other carriers. While this might be frustrating for the business, it’s an easy win for you if you’re looking to get out of your cell phone contract and pick up service with another provider.
While the exact terms of the deals change from time to time, one of the most generous carriers currently available is T-Mobile. They’ll cover the ETF and device payment fees for up to 10 lines for switching to their service. You simply hand over your old device and sign up for new lines of service for each line cancelled with your current carrier.
Options with other carriers range from credits on your bill to recoup the cost of the ETF and gift cards for products and services to paying your ETF if in full if you meet particular terms. While the later deals are often the best, just be sure to read any new terms and conditions to ensure you’re not just fixing one problem to be tied to another.
Browsing through forums or article comments, you’re bound to see some creative solutions for cutting ties with your cellphone carrier. We’ve dug into the rules and regulations to address a few of the most common and provide you with answers.
Nearly every carrier has a clause that deals with military deployments or relocating due to military service. Whether you’re simply looking to place a hold on your contract or cancel completely, giving them a call will often yield results. However, you have to be prepared to backup your request with documentation. Your commanding officer or field office should be able to provide with any forms necessary. Then you’re just a quick fax away from mobile freedom.
I Can’t Pay If I’m Dead Right?!
This one comes up time and time again. “Oh just have a family member call up and claim you died/lost an arm/are in a coma!” Sounds great--sort of. But in reality, the first thing they will request is an official death declaration, obituary, medical bills or other proof. Even if you could work something out, you’re still technically breaking a number of laws. Don’t try this one. It’ll only lead to trouble.
Residents of Canada will find a few additional stipulations to their ETFs. But you’ll also find a few more options. One of the biggest changes in recent years is the passage of the Wireless Code. A key component of this was establishing fair ETF policies and reducing the maximum contract term from three years to two. If you started in a three-year contract and you’re near the end of your agreement, you might find that it’s already ended.
Here are a few additional links to tools that might help you break free of your contract. If you have additional questions, you can also leave a comment or head to our Q&A forum as well!
The ETF Policies of Popular Carriers:
So there you have it! Everything you need to negotiate your way out of your existing cell phone contract and move on to clearer, faster, better pastures.
Regulations change and providers are always looking to close loopholes and keep customers onboard, so if you encounter any problems, be persistent and don’t hesitate to ask questions!
We’d love for this guide to be as valuable as possible for the community and anyone out there trying to extricate themselves from the clutches of their contracts. To do that, we need your help.
Here’s what you can do to get involved:
1. Ask Questions. Post them in the comments of this post, or Tweet them to us at @TheInformr.
2. Share Your Experience. If you have anything to add, share it in the comments below. We'd love to hear from you!
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P.S. If you’re looking to pick up a new device with the money you saved avoiding your ETFs, we’ve got reviews on the best phones including in-depth review summaries. Canadian readers can compare rate plans here.