How to get out of your mobile phone contract

UNSHACKLED.com takes a look at the options available to you for getting out of your mobile phone contract.

Traditionally, the mobile phone industry has offered the best deals to those who commit to longer-term contracts. They work by offering people a “free” phone, alongside monthly tariff payments over a period of 18-24 months. While this might seem like an attractive option at first, some people find it to be expensive further down the line. Others don’t enjoy being tied into a contract for such a long period of time, decide they don’t like their phone/terms of contract or find a better deal elsewhere after they’ve signed on the dotted line.

So what options do people have once they’ve agreed to a mobile phone contract? Are they stuck with it or is there an exit plan?

Here are a few things to consider if you want to get out of your mobile phone contract.

Prevention is better than the cure

It’s not easy to get out of a mobile contract and if you do manage to exit the agreement, you’re likely to have to pay for it depending on how long it’s been since it began. Consequently, the best thing you can do is take every possible to step to ensure the contract you enter is the right one.

Before you sign on the dotted line, make sure you check the mobile signal strength in the key places you use your phone, e.g. home and work. Ofcom (the telecoms regulator) has its own coverage tool, which offers an independent view on performance for calls and data by location. It adds its own tests and consumer feedback to the networks own data to give an easier compared view by network.

Make sure you compare other deals on the market to ensure you’re getting the best price. It’s also worth seeing if you can afford to buy the phone upfront and just pay for the tariff, as this makes things much cheaper.

You might have a cooling off period

If you entered into a mobile phone agreement over the phone or online, then you have 14 days during which you can cancel the agreement if you change your mind or see a cheaper deal elsewhere.

This is not a license to ‘try before you buy’, however. As with all goods, a return is expected to be in the same condition as when sold and you may be charged for any services actually used. It’s wise to check with each retailer before you purchase and make sure you cite Consumer Contracts Regulations when requesting the cancellation.

You may be able to exit if there’s been a material change to your service

You may be able to exit a contract penalty free if your network hikes up the price mid-contract (although all the main networks have now built terms and conditions into the contract to allow them to increase the monthly cost mid-contract in line with RPI) or there is a significant change in your coverage quality.

Early termination fee

Your contract terms will mean that if you try to exit the agreement early, you will be required to pay an ‘early termination fee’. This is normally equivalent to your monthly line rental multiplied by the number of months you have left on your agreement. Essentially, you are paying off the remaining phone and airtime balance even though you’ll never use the airtime. You can try and reduce this cost by decreasing your tariff allowance if your network allows and then recalculating the early termination fee.

Don’t Miss Your Contract End Date

Make sure you have your contract end date firmly locked into your memory.

When you reach the end of your contract term, if you’re happy with the phone you have, you should still contact your network to make sure you move onto a SIM Only tariff, otherwise you might continue to be effectively paying for a phone that you’ve paid off.

UNSHACKLED.com offers a reminder service: simply register your details and they’ll tell you when it’s time to start looking for your next deal, how much your current phone is worth if you traded it in and whether that would cover any early termination fee you might have on your current contract.

Learn From Your Mistakes

The frequent release of new phones and the increasing number of airtime networks in the mobile market means that locking yourself into a two-year traditional contract can be costly in the long run and leave you very frustrated. There are different ways to buy your phone that can help avoid these frustrations and save you money in the long run.

Splitting the traditional contract as UNSHACKLED.com does into separate phone and SIM components (think uncoupling of package holidays into separate hotel and flight bookings) means that you can benefit from a choice of phones and flexible payment options. You can also have complete freedom to choose a SIM Only network and tariff that meets your individual usage needs.

This method means that you can more easily alter your tariff to deal with changes in your circumstances (be it personal finances or usage), or take advantage of improved value deals that come to the market. It also gives you control and flexibility with your phone, making it considerably easier and cheaper to get your hands on that new iPhone every year.

 

The information in this piece is provided by UNSHACKLED.com. At Noddle, we do not give financial advice, and we accept no responsibility for any information or advice provided. We provide this service free of charge but may receive commission or payment from UNSHACKLED.com for introductions.

Noddle is a Credit Broker and not a mobile phone contract provider.