Here at Which? we always recommend you switch to the cheapest provider where possible, but with mobile phone contracts our advice is to proceed with caution if you want to cancel or buyout your contract early.
Before you sign up with a new mobile service provider, check carefully whether you have the right to cancel your contract and if so, at what stage.
According to Ofcom rules firms must have ‘swift and hassle-free’ processes if you complain about poor service and make it easier for you to switch.
If you cancel before the minimum contract term is up, you'll have to pay an early termination fee or buyout your contract.
In most cases these fees are very high. For instance, if you signed up to an 18-month contract and want to cancel in the second month, you might have to pay 16 months' worth of fees.
In this case it might be worth staying with your provider until the minimum term is up and then calling them to renegotiate a cheaper deal or telling them you’re going to switch.
If you want to cancel your mobile phone contract after your initial contract term is up, you can do so at any time, although most companies require 30 days' notice.
You normally have the right to keep the same mobile phone number when you switch mobile provider.
To do this, you need to ask your existing mobile provider for a Porting Authorisation Code (PAC).
You give this code to the new provider to make the switch but most companies require a month’s notice.
You don’t have to give a reason for cancelling the phone service and should be refunded. However, you must pay for the value of the service that is provided up to the point you cancel.
If you buy a mobile handset online, by mail order or over the phone, under the Consumer Contracts Regulations you have the right to cancel from the moment you place your order up to 14 days from the day you receive the phone.
This 14-day period is the time you have to decide whether to cancel, you then have a further 14 days to actually send the goods back.
You should get a refund within 14 days of either the retailer getting the goods back, or you providing evidence of having returned the goods (for example, a proof of postage receipt from the post office).
If you buy your mobile phone or enter into a phone contract in a high street shop, then you don’t automatically have any cancellation rights if there isn’t a problem with the handset or the service.
But, some mobile shops do have generous returns policies so read the shop’s policy before buying.