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The cell phone industry tops the Better Business Bureau’s consumer complaint list with more than 28,000 complaints filed with the agency last year. It’s not surprising that the typical two-year contract can feel more like a prison sentence for many of the 243 million Americans who have cellular phones. If you want to get out of an agreement early, you’re likely to be hit with a hefty termination fee that can exceed $200.
“Generally, cell phone companies can get away with unfair practices. Bad service and dropped calls are all protected by early-termination penalties,” says Ed Mierzwinski, consumer program director of U.S. Public Interest Research Group.
However, you do have options. There are four situations that might release you from a long-term service contract without having to pay a penalty:
You moved to an area that does not have service. Many wireless companies handle complaint situations on a case-by-case basis. For example, T-Mobile customers are released from their contracts if a technician is unable to fix problems within their coverage area, says Julie Robertson, a spokeswoman for the company.
A change in your contract is materially adverse. Major carriers adhere to a code of ethics outlined by the Cellular Telecommunications & Internet Association. The code requires carriers to include a material adverse change clause, which states that carriers cannot modify the terms of a user agreement, especially if the terms are not in the customer’s favor, without providing advance notice and at least 14 days for customers to cancel their contracts without incurring a fee.
You were deployed by the military to an area that does not have service. Verbal confirmation and the contact information of a commanding officer is all that is needed for a Verizon customer on active duty to terminate service, says Verizon Wireless spokesperson Brenda Raney. Service can be suspended for a maximum of 48 months.
You transferred your cell phone contract to someone else. You can use Celltradeusa.com to purchase another customer’s cell phone contract and transfer responsibility. At CellSwapper.com, cell phone users can find someone willing to assume their contracts and swap wireless plans. Note that all carriers allow contract transfers, but each has different rules. For example, some require the person taking over the plan to sign a new contract and pass a credit check.