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Verizon’s New Early Termination Fee Policy Makes You Pay a Full ETF Up to 8 Months

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Verizon made a major policy change this morning to its customer agreement that directly relates to your Early Termination Fee (ETF), a change that makes it more expensive for you to cancel service with the carrier in the first 8 months of your a 2-year contract, when compared to the previous policy.

The ETF with a 2-year contract used to decline by $10 for each full month of your contract term that you completed. With the new policy, you won’t see a reduction in your ETF fee until the 8th month of your contract term. In other words, you will pay the full ETF fee should you decide to leave Verizon, even if you have been with the carrier for six or seven months. 

With the old policy, you would see a substantial reduction in your ETF after completing up to eight months, but the new ETF policy lays out a much different schedule. In the new policy, you are stuck with the full $350 ETF on “advanced devices” for the first seven months of a contract. From months 8-18, you will then see the ETF decline by $10 per month. Then from months 19-23, it will decline by $20 per month. In the final month of your contract, your ETF will reduce by $60.

The new policy only applies to anyone who signs a contract on or after November 14. If you signed a contract before November 14, the old $10 per month reduction still applies.

Here is how the new ETF policy reads:

If you cancel a line of Service, or if we cancel it for good cause, during its contract term, you’ll have to pay an early termination fee. If your contract term results from your purchase of an advanced device on or after November 14, 2014, your early termination fee will be $350, which will decline by: $10 per month in months 8–18, $20 per month in months 19–23, and $60 in the final month of your contract term. For other contract terms entered into on or after November 14, 2014, your early termination fee will be $175, which will decline by: $5 per month in months 8–18, $10 per month in months 19–23, and $30 in the final month of your contract term. If your contract results from your purchase of an advanced device prior to November 14, 2014, your early termination fee will be $350 minus $10 for each full month of your contract term that you complete. For other contract terms entered into prior to November 14, 2014, your early termination fee will be $175 minus $5 for each full month of your contract term that you complete.

As you can see, a new tiered approach also applies to devices that fall outside of the “advanced device” tag.

Cheers Aaron!
  • Frank E. Licata

    I think what it all boils down to is people do not realize that when they buy an advanced device the carrier is subsidizing the cost of that device about $500 or so. So therefore they are entitled to recoup that over the course of two years. For example The new iPhone cost $700, of which $500 is paid by Verizon and $200 is paid by the customer. Nothing in this world is for free.

  • Phil Hyde

    Would this change invoke the “60 day” clause in the customer agreement?

    “you can cancel the line of Service that has been affected within 60 days of receiving the notice [of the change] with no early termination fee if we fail to negate the change after you notify us of your objection to it.”

    • anon

      no because this is on NEW contracts…….

  • Bryan

    Instead of offering a quality product at a fair price, they change their terms to make it harder to leave. Pathetic. I’m already going to leave Verizon for Tmobile next week when the N6 comes out due to Verizons trap called a data meter that I got caught in a few months ago and this is just icing on the cake

  • Elizabeth Zima

    Dickwads!

  • StankyChikin

    $30 T-Mobile Plan 🙂

  • Me

    This is why I’m no contract for life. I don’t care if I have to rock a N4 for the next 3 yrs.

  • Vanquishgc

    On the surface, this is crap, and as a Verizon customer I facepalmed. However, it’s actually smart business. It’s a two fold strategy : for one, it makes it much harder for other carriers to buy out contracts, so essentially a shot at T-Mo. Second, it’s a way to steer more people towards Edge, where in the event of cancellation, Verizon doesn’t eat the loss of phone subsidy. And along those lines, it does help prevent fraud. Someone else mentioned it, but being a former employee, I witnessed many cases where people would want to add or start up 3to 5 lines, all iPhones usually, only to turn around and sell them on the street, or Craigslist or whatever. This sort of thing doesn’t just affect Verizon or whatever carrier, but the salesperson as well. You don’t just lose commission, but you eat a portion of the equipment loss, which can be crippling to your paycheck. My only issue with this is that at the 8 month point, it shouldn’t just go down 10 bucks each month from the $350 point, but rather the ETF at that point should be lower. Essentially, at month 8, drop from $350 to $270, then go down ten bucks going forward.

  • Tom Bryant

    Oh hey, by the way, Mr. Average Joe consumer who thinks it is a great idea to buy a phone then let T-Mobile pay your ETFs… your sales rep is docked from his commission pay for THE FULL PRICE OF YOUR HANDSET(S) IN ADDITION TO ANY PROFIT HE ORIGINALLY WAS PAID — FOR UP TO SIX MONTHS after you activate service.

    You aren’t hurting Verizon… they got big pockets. You are hurting a working man/woman who is trying to feed a family and support themselves. Remember that when you play these games.

    • StankyChikin

      Cry much?

      • Laymans Terms

        Someone makes a valid point about how people working the system hurts real individuals and you don’t care? Sad day on DL.

        • StankyChikin

          I will agree with you once I see a valid point made.

    • Artune

      We all have challenges at the work place. Make sure you’re a rep that is so good at the demo/presentation they won’t switch over to the next company. Also Verizon cares about each gusto lost trust me

      • Laymans Terms

        You say that. But previous comments show how people want to purposefully take advantage of these gaps in the system regardless of the individual who is stuck processing the transaction. Worst yet I am willing to bet most people who go into the stores get upset at reps upsellig as part of their jobs. Least they could do is order the devices online so only Verizon is hurt and not the rep.

  • Think about like a game of chess, TMO’s move put VZW in check the had to play a defensive counter but still gives TMO leverage. Their campaign to buy contracts was a success.

  • Justin Kos

    Glad Ive been prepaid since 2012

  • they should be less concerned with screwing us on the ETF and more concerned with screwing us on the Nexus 6. come on.. announce something already!