What's an ETF? An early termination fee is something you agree to, albeit grudgingly, when you sign a contract with a carrier. In return for, say, Verizon, selling you a phone for $199 instead of the "full" $499 off-contract price, you agree that you'll stay with that carrier for a given amount of time. In the U.S., that's usually two years. (In Canada, it could be an excruciating three years.) So you get a cheaper phone, and the carrier gets guaranteed monthly payments.
You can break out of that contract, but there are penalties. That's where the ETF comes in. If you want to break a contract and move your service to another carrier, you'll have to pay the early termination fee. It's usually prorated depending on how many months are left on your contract, which is good. But it still can be several hundred dollars. (Occasionally you'll hear about your new carrier promising to pay the ETF for you.)
Here are the ETF conditions for the four major U.S. carriers as of this writing:
- Verizon: $350 for an "advanced device"; $175 for others.
- Sprint: $350 for an "advanced device"; $200 for others
- AT&T: $325 for an "advanced device"; $150 for others
- T-Mobile: $200 if more than 180 days left on contract; $100 for 91-180 days left on contract; $50 for 30-90 days. With less than 30 days remaining, ETF is $50 or amount of your bill, whichever is less
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