James Walker: Lessons in the valuable art of bailing out early

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We’ve said it before and we’ll say it again. If you stay loyal to a business, chances are you’ll end up paying more.

But how do you know if you can switch? Some contracts are complicated – and many will charge you exit fees if you want to leave. Here are our tips.

You can switch it you’re...

...out of contract

It seems obvious, but how many of us really do know if we’re reaching the end of our contracts?

You can plough through your online accounts or letters, but the simplest thing to do is get your bank and/or credit card statements for 13 months (the extra month is to cover any payment dates that might have shifted). Add any annual policies, contracts, agreements or subscriptions to an app, spreadsheet or good old-fashioned list. Set up a calendar reminder a month before the renewal date so you know you’ve got time to shop around.

...if the firm isn’t providing the service you signed up for

The service that businesses offer you may change. A good example for 2020 is streaming and broadband services. Disney recently pulled tons of its previously licensed programmes and films from other broadband and streaming services. If you can demonstrate that the channels or programmes that you watched made up the majority of your viewing you could, in theory, break the contract. Put your case to the business and ask them to waive any leaving fees.

...if the relationship has broken down

Sometimes relationships with businesses break down and you shouldn’t have to be tied to them by a contract if they’ve behaved badly.

As with any relationship, it pays to be honest with yourself about where the blame lies. If a business has treated you badly and refuses to listen, then make a complaint and take it to an ombudsman or alternative dispute resolution scheme (ADR) if need be. Make sure that you specify in your complaint that you want to move on without charge.

...you’ve moved and the service isn’t available

One of the big areas of complaint we’ve seen involves people who move to other parts of the UK where a service isn’t available or isn’t much cop. This is most common when it comes to broadband, cable or mobile phone services.

If your service isn’t available in your new home you shouldn’t have to pay an exit fee. Yet some firms (particularly broadband providers) are still digging their heels in over this. We say, don’t take no for an answer. Be polite but firm. Go to the free ombudsman service if they don’t listen.

...the firm changes it’s T&C’s and you’ll be paying more money

Contracts are a real nightmare to decipher sometimes. This is largely because businesses like to build in “get out of jail free” clauses should they decide to change the rules. Most sectors allow businesses to change their contracts midway through. But if the change is “significant” and you’ll be paying more money; you should be given the opportunity to get out of the contract without charge. However, you’ll be given a window of opportunity to do this and if you don’t respond in time, you’ll often be charged if you realise late and try to leave.