moving overseas

macman

invisibleyousee wrote: »

Hi T_T - I just took out a contract and they said over the phone about that, but I still don't entirely understand how that works in terms of "equal amount to what it costs them to lose you" - how do they work that out?

Quite simply-it's the monthly payment x the no. of months left on your contract. Which in your case appears to be £40 x 15 months = £600.
That's what you agreed to when you took out the contract. Leaving the country does not void your binding contract.
Try and sell the contract on to a trusted friend.

Rusty!

macman wrote: »

Try and sell the contract on to a trusted friend.

Problem is the contract without the decent phone isn't likely to be worth half it's original value.

T_T_2

macman wrote: »

Quite simply-it's the monthly payment x the no. of months left on your contract. Which in your case appears to be £40 x 15 months = £600.
That's what you agreed to when you took out the contract. Leaving the country does not void your binding contract.
Try and sell the contract on to a trusted friend.

That's not true, that is the opposite of what I am trying to explain. Whilst I personally believe the OP (and others in similar situations) should pay what they agreed to at the start of the contract, the government seems to be a bit more forgiving.

Basically my understanding of the new rules (I welcome any corrections) is that the carrier can only charge you an amount which allows them to break even should you be unable to carry on your contract.

So let's say the OP is paying £40/mo to the carrier, but it actually onlt costs the carrier £10/mo to service this customer (this is telephony and data services and excludes the cost of a provided handset)

So if the customer wishes to cancel their contract it no longer costs the carrier £10/mo to service the contract as the phone isn't being used.

Now, if they provided the customer with a free or subsidised handset then the user would either need to return it or in this case pay the value of the handset or the carrier would stand to make a loss.

macman

Rusty: indeed, but anything that reduces the £600 debt is a bonus.
I would also ask why the OP bought such an expensive handset without insuring it, if they didn't have the funds to replace it?

T_T: what 'new rules' are you referring to? The agreement to limit contract buy-out sums agreed by some telcoms recently refers to broadband contracts, not to mobile contracts. How on earth can anyone (including the mobile co.) quantify exactly what it costs to service the account, and what is profit?
It's a straightforward civil contract, which allows the telcom to be put back in the position they would have been in before the contract was breached. Their 'position' on this is that they would have received revenue of £600. How much of that is profit is irrelevant.

grumbler

T_T wrote: »

The new rules state that they can only charge you an amount equal to what it costs them if they lose you as a customer.

T_T wrote: »

Basically my understanding of the new rules (I welcome any corrections) is that the carrier can only charge you an amount which allows them to break even should you be unable to carry on your contract.

So let's say the OP is paying £40/mo to the carrier, but it actually onlt costs the carrier £10/mo to service this customer (this is telephony and data services and excludes the cost of a provided handset)

So if the customer wishes to cancel their contract it no longer costs the carrier £10/mo to service the contract as the phone isn't being used.

I don't know the actual wording, but the above allows for different interpretations.

If they lose the customer they don't provide the service and this doesn't cost them £10 p.m.

If you stay as a customer they make profit N*(£40-£10).

If they "lose you as as a customer" they don't make N*£30.

"what it costs them if they lose you as a customer" can be interpreted as N*£30 that they lose.

My guess is that the new rules (if any) don't allow penalising the leaving customers with more than N*£40 or N*£30.

invisibleyousee

Thanks for the explanation there - had to ask out of curiousity! Agree that anything that reduces the OP's £600 debt would be an advantage for them.

Long term expensive contracts present their own difficulties in situations like this...I purposefully took a £10 a month contract as wanted to avoid a high monthly cost/contract buy out should something happen in 18 months time that I'm not anticipating!

OP - what network are you with? Also, I may be wrong but I believe I have read somewhere before that to buy out of a contract, it can be minus VAT (which is currently at 20%). I could be wrong there but worth checking.