Cell Phone Early Termination Fees "Ridiculous"

Castro Valley, CAGloria M. would like cell phone companies like Sprint to change their policies regarding early termination fees. She knew an early termination fee would be charged if she canceled her contract, but the amount charged for a termination fee was high and Gloria says Sprint took that money out of her account without her authorization.

"I have been with Sprint for probably eight years or more," Gloria says. "I have been financially struggling. I'm a single mom and my teenage son had a second cell phone on my account that he was not using at all. I decided to discontinue the second phone. When I phoned Sprint, they said they could cancel it, but I would have to agree to a new two-year contract to do so. I didn't want to do that but I needed to cancel the second line, so I agreed.

"Shortly after that, I called to cancel my contract completely because I was moving. Sprint said I could not cancel until my bill was paid in full. I still owed $400, so I made arrangements for a payment to come out of my account once a month. In March it was paid off.

"Then, I got a bill for another $400. This bill was from a collection agency. I called the collection agency and told them I paid the $400, but they said that Sprint had now added an early termination fee of $400. The collection agency suggested I call Sprint to see what could be done.

"Sprint was not willing to do anything. I had initially tried to cancel the service in December. They could have told me then that I would actually have to pay more to cancel my service. They waited until I paid off my bill and then added the new charge. It's a ridiculous amount.

"Also, the early termination fee was added to my account in March, when the other bill was paid off. They took a payment out of my account in April. They were not authorized to do that. They were only authorized for the initial agreement of $400.

"When I canceled the one phone, Sprint said I had to agree to the extended contract, that there was no way I could get out of it. I have been a customer for many years. Why did they have to do that? That's no way to treat a customer. These policies need to be changed. It's not fair. We used to get much better service from utility companies. I think they change policies during your contract and you don't always know. It's ridiculous."

Many cell phone companies argue that early termination fees are necessary to offset the cost of giving customers a free phone. However, if that is the case then why does every change to a cell phone account automatically mean a two-year contract extension? If the cost of the phone is the problem, then a change to the account should only affect the contract length long enough to recoup the cost of the phone. This means that changing your account with only a few months left on a contract should not automatically extend your contract for two years but rather for a couple of months.

Unfortunately, cell phone companies use a variety of excuses to justify unreasonable early termination fees. Gloria may have agreed to a two-year contract extension, but what choice did she have? Despite being a customer for over eight years, Sprint still took the opportunity to charge her $400 for canceling her phones and apparently took the money for the early termination fee right out of her account, without her authorization.

If you feel you have been unfairly charged an early termination fee, contact a lawyer to discuss your legal options.