Terminate Cell Phone Contract

If you pay an early termination fee to get out of a cellphone contract will it affect your credit?

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Bill's Answer: Bills.com Resident Expert

Early termination was contemplated at the start of the contract, so therefore the cellular provider wrote a clause into your contract that allows consumers to exit their contracts by paying a lump-sum. This should not be considered a derogatory mark on a credit report because it is not an indication of a delinquent payment.

Should not. Note my word choice.

I do not hold US cellular providers in high regard because I believe their contracts are one-sided in their favor. I believe their US oligopolies have retarded innovation and service, and resulted in prices that are higher than an open market would sustain. I am certain US officials in the cellular provider industry would disagree with that assessment, but I digress.

Because I do not hold US cellular providers in high regard, I am wary all will report an early termination to credit reporting agencies properly. However, do not let my jaded view of US cellular providers influence your decision to terminate a contract. Should a US cellular provider report an early termination as a derogatory item, dispute the listing.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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