Understanding Your Broadband Contract

Avoid hidden charges and other surprises on your monthly statement. Understand the fine print in your broadband contract. That way, if you find yourself dissatisfied with the service offered by your carrier, you won’t have any problems when it comes to terminating your subscription or disputing the contractual terms and conditions.

A broadband contract works both ways. You are obligated to pay on time, and your broadband provider is responsible for delivering an acceptable service level. As long as you understand exactly what you are signing up for, then the relationship between you and your ISP remains a mutually beneficial arrangement.


Here are seven important things to look out for and examine in the fine print of your broadband internet contract.


  1. Installation fees and other upfront charges. Some ISPs require set-up fees to cover the cost of equipment installation and ask you to pay for the first two months upfront. These upfront charges are disclosed to you upon signing up, so pay close attention.


  1. Charges incurred in excess of your download capacity. If you are a heavy downloader, select a broadband package that has sufficient download capacity. This prevents you from getting charged extra when you go overboard.


  1. Charges incurred for non-direct debit. Low-income households may have limits to their personal banking. If you cannot pay by way of direct debit, then the ISP can charge you extra for it.
  1. Charges for calling technical support. Look for a clause in your broadband contract that specifies charges for calling technical support, if you need help with internet connection issues.
  1. Fees for late payment. Most ISPs charge fees for late payment. You can also get charged additional fees for insufficient funds if you allow direct debit. Also, take note of how long you can default on the payment before your service is cut off. If you are going to send in payment that’s late for a day or two, you might want to call your ISP, explain your situation, and politely negotiate to have the fee waived.
  1. Reconnection fees. Reconnection fees can result from installing your service in another location (in case you move) and reconnecting your service after being suspended for late payment.
  1. Termination fees. This is a standard in most broadband contracts, so you might want to keep in mind that you can get tied with an ISP for a year or so. Consider your financial status, online needs, and other activities that may cause you to cancel your subscription in the middle of the contractual period. If you have plans to move to another location, then you might want to hold off on signing any contract. Sometimes, even if there is no minimum contract period, you can still get charged a cancellation fee so the ISP can recoup the cost of providing you with free equipment.

Look out for possible pitfalls in your broadband contract and weigh your options accordingly. This applies to both residential and business broadband packages. If you know your needs, usage restrictions, plan flexibility, and the terms specified in your broadband contract, then you should not have any problems. Plus, it does not hurt to ask your ISP beforehand to spell out all the gray areas for you.

By K. Ong

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