Stuck in a telecom contract? Here's what you can do about it.
We go through telecom contracts for businesses and find the cheapest way out, if there is one. Before you call anybody, find out if you're still in term and read the early termination clause. Then do the math for each circuit.
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The short version
- Pull the signed agreement for each service. Look at the start date, how long the term is, and what happens when it ends.
- Read the early termination clause so you know how the fee is figured and what it covers.
- Before you cancel, ask whether you can renegotiate, change the service or move it.
- If a new carrier offers to cover your fee, get it in writing before you cancel anything.
- Do the math for each circuit. Compare what it costs to leave now with what it costs to ride it out.
- Close to the end of your term? Then it's really a renewal decision. Read the 90-day renewal window instead.
First, find out if you are still in term
Pull the signed order or service agreement for each service. The bill won't tell you enough. Look for the start date, how long the term is, and what happens when it ends.
A lot of older services are already past their term. Some went month-to-month. Some renewed for a new term because nobody sent notice. You need to know which one you've got, because the cost of leaving is very different.
Can't find the paperwork? Ask the carrier in writing for the signed agreement and the current term end date for each service.
Read the early termination clause
This is the part that decides what leaving costs you. Look for these four things.
How the fee is figured
Some agreements charge everything left on the term. Others charge a part of it, or a fee that goes down over time.
What it applies to
The fee might be per circuit, per location or for the whole agreement. Check which.
Minimum spend
Some agreements have a minimum total spend. If you drop services, you can get hit with a shortfall charge even if you never cancel.
Waived install costs
If the carrier waived install or construction costs when you signed, leaving early can bring those costs back.
Not sure what the clause means? Ask your attorney. This post isn't legal advice. For other clauses that cause trouble, see five telecom contract traps.
Ask about these before you cancel
Cancelling isn't the only way out.
Renegotiate with your carrier
Ask for a better rate or a different service. Ask whether that starts a new term, and read the new end date.
Change the service
Some agreements let you change the bandwidth or the product without paying the full fee. Some start a new term when you do. Check both.
Move the service
If you're relocating, look for a relocation clause. Some let you move the service to the new address under the same agreement.
Ride it out on purpose
If the term ends soon, staying might cost less than leaving. Put the end date on your calendar and plan the switch for then.
Moving offices? Read how much lead time a move needs before you give notice at the old place.
When a new carrier offers to cover your fee
Some carriers will give you a credit toward the fee you'd owe your old carrier. It depends on the carrier and the product, and the offers change. Ask these questions first.
- How much of the fee does it cover, and is there a cap?
- Is it a credit on future bills or an actual payment?
- What proof of the fee do they need, and by when?
- Do you have to sign a certain term with them to get it?
- Is the buyout written into the order or contract you're signing?
- When should you cancel the old service so the new one is already working?
Get every answer in writing. Then cancel the old service, and not a day before.
Do the math for each circuit
One account can have a lot of services on it, each with its own end date. Give each one its own row with the location, the service, the monthly charge, the term end and the fee if you leave now.
Then look at each row and compare what it costs to leave now with what it costs to stay until the end. Some will be easy to drop. Others will be cheaper to ride out.
It's easier if every location is on the same spreadsheet. See multi-site telecom management. If the bill itself looks wrong while you're doing this, read how to dispute a telecom bill error.
Get the exit terms right before you sign
It's a lot easier to set up a way out on the day you sign.
- Know how the early termination fee is figured before you sign.
- Ask for a relocation clause if there is any chance you move.
- Ask for the right to change bandwidth without starting a new term.
- Put the term end and the notice date on a calendar the day you sign.
- Keep the contract in your name. See contracts in your name.
- Have somebody read the paperwork before you sign it.
We look over contracts before you sign and point these clauses out. See contract renewal defense.
How Buckeye helps you get out early
You pay $0. The carriers pay us, and the contracts stay in your name. We've been independent since 2003 and we're based in Sugar Grove, Ohio.
Send us the contracts
Send the agreements and your recent bills. We list every service with its term end and what it costs to leave.
We get quotes
We get quotes from the carriers that serve each building and ask about buyout credits when they're available.
We watch the next end date
You sign in your name. We keep the next term end on the calendar so you don't get stuck again.
Questions we get about leaving a contract early
Will a new carrier pay our early termination fee?
Does renegotiating with our current carrier reset the term?
What happens if we just stop paying?
Is this the same as the renewal window?
What does it cost to have Buckeye review our contracts?
Related
Contract renewal defense.
We start no later than 90 days before the notice date.
Read → Cost controlFive telecom contract traps.
The clauses that tend to cost businesses money.
Read → Cost controlYour carrier auto-renews in 90 days.
What to do before the notice window closes.
Read → Cost controlHow to dispute a telecom bill error.
How to get the carrier to fix a wrong charge.
Read →Send us the contract. We'll tell you what your options are.
No obligation. You pay $0. The carriers pay us.
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