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Early termination charges cost more than serving out the remainder of the contract???

LimaYankee
Newbie
Posts: 1
Registered: 10-07-2016

Early termination charges cost more than serving out the remainder of the contract???

Can someone please confirm what early termination charges apply to the moneysupermarket "Free unlimited broadband for 12 months" deal? (https://www.plus.net/deals/unlimited/line-only/1617affcash1/)

 

A Plusnet advisor told me that the normal early termination charges apply to this deal, even though under the deal the broadband is £0/m for 12m, i.e. early termination charges are
£10.75/m without line rental saver
£4.00/m with line rental saver

That means if you take this deal with the line rental saver option, cancelling before the 12m contract has ended actually costs more than completing the 12m contract!

i.e.

If you take this deal with the line rental saver option, and complete the 12m contract, total cost is £185.88

If you take this deal with the line rental saver option, and but cancel after the first month, total cost is £185.88 (not refunded) + £4 * 11 = £229.88

Is this correct?Huh

Live chat transcript:

 

Plusnet Advisor: at 16:35:20
Hi there, how may I assist you with your Plusnet order today?

Lima Yankee: at 16:44:29
I'm thinking of signing up for this deal: [link to the deal]
Can you please confirm the early termination charges:
(a) if I take the line rental saver option (i.e. pay for £185.88 for 12m line rental upfront)
(b) if I choose to pay line rental monthly (£16.99/m / £17.99 from 1st September 2016)

Lima Yankee: at 16:46:19
I understand how early termination charges work normally, but I'm not sure what happens when I'm signed on to a deal where the broadband is supposed to be £0 for the first 12 months.

Plusnet Advisor: at 16:46:35
Not a problem.

Plusnet Advisor: at 16:46:59
A) The cancellation charge for Unlimited broadband and Phone with Line Rental Saver is £4 per month.
 
Plusnet Advisor: at 16:47:11
B) The cancellation charge for Unlimited broadband and Phone is £10.75 per month.

Plusnet Advisor: at 16:49:23
The great thing about the line rental saver is after the prices changes it will add more value to your package.

Lima Yankee: at 16:49:47
Can you please double check for option A - there should be no early termination charge because otherwise that would result in me paying more than I would have if I'd completed the full 12 month contract.

Lima Yankee: at 16:50:28
Unless the £4 early termination charge is applied after pro-rata refunding me the unused line rental
 
Plusnet Advisor: at 16:52:11
I have double checked, if you cancel early with the line rental saver option it is £4 a month remaining on the contract. The line rental saver in non-refundable.

Plusnet Advisor: at 16:57:39
Is there anything else I can help you with?

Lima Yankee: at 17:00:12
Ok, to make sure I understand: If I take this deal with the line rental saver option, and see the contract through the whole 12m, I will pay £185.88 over 12m (because the broadband is £0/m for the first 12m). But if I take the same deal then cancel after the first month, I will pay £229.88 over 12m (the £185.88 is not refunded and on top of that I have to pay £4/m for 11 months).

Lima Yankee: at 17:00:52
That can't be right, the early termination charges should never be more than what it would have cost to serve the remainder of the contract.

Plusnet Advisor: at 17:02:43
Yes but the broadband you are receiving for free, actually cost £9.99 a month. So if you consider the price in full, I am sure canceling works out cheaper.

Lima Yankee: at 17:04:09
Nope, under this deal [link to the deal] the broadband really is £0/m for the first 12m

Lima Yankee: at 17:04:26
That's why I'm asking specifically what early termination charges apply under this deal

Plusnet Advisor: at 17:05:48
Yes broadband is £0 a month because of the special offer that is available to you. But the broadband outside the special offer costs £9.99 a month.

Plusnet Advisor: at 17:07:12
And it is these terms and conditions that apply.

Lima Yankee: at 17:09:31
Yes, so if I take this special offer with the line rental saver option, cancelling the contract is more expensive than completing the minimum term?

Lima Yankee: at 17:10:10
^cancelling the contract before 12m is more expensive than completing the 12m minimum term

Plusnet Advisor: at 17:10:44
Yes, but that is simply a sign of how good the deal actually is.

Plusnet Advisor: at 17:11:53
Is there anything else I can help you with?

Lima Yankee: at 17:13:01
I thought early termination charges LEGALLY must be less than what it would cost to complete the contract. i.e. if you've made a non-refundable payment for the whole contract term upfront, then there should be no early termination charges?

Plusnet Advisor: at 17:15:00
Well I am not an expert of the law, but as I said before the terms and conditions will be associated with the broadband the costs £9.99 a month. So the cancellation charges are less.
 

 

1 REPLY
Community Gaffer
Community Gaffer
Posts: 17,644
Thanks: 636
Fixes: 162
Registered: 05-04-2007

Re: Early termination charges cost more than serving out the remainder of the contract???

The early termination charges are worked based on the standard cost of the service, not the discount or special offer rate which is why they may be higher in your circumstances.

If this post resolved your issue please click the 'This fixed my problem' button
 Chris Parr
 Plusnet Staff