We've all been there. You seek out the best value broadband service; it all goes swimmingly for a few months; and then - Blam! - a letter lands on your doormat telling you that the price is going up.
Mid-contract price rises are the worst part of any broadband deal, and they're mostly unavoidable. But if the increase is larger than you're expecting you don't have to accept it. Depending on how much extra you're being asked to pay, and whether you knew about it before you signed up, you may have options.
Let's take a look at what you can do when your broadband supplier puts up their prices.
Are broadband suppliers allowed to put their prices up?
Nobody likes it when prices go up, but sometimes broadband providers are indeed allowed to start charging you more. In fact, in a lot of cases you'll have agreed to it. Here are the three main scenarios where you might encounter price hikes.
1. Your minimum contract period has ended.
To attract new customers, most broadband suppliers offer a bonus price that covers the minimum contract period, normally between six months and two years. When this period ends your broadband service will continue, but the price will shoot up by sometimes more than 50 percent. You can easily end up paying an extra £20 a month. What's worse, if you stick with this package you're likely to see annual price hikes way above average. To put it simply, when your minimum contract period ends you must start shopping for a new deal. And make a note of the date it ends, too, so you don't forget.
2. Your contract terms specify allowed price hikes.
On a variable deal, your provider will state in the contract that they can bump the price by maybe five or ten percent after a certain time. As long as they stay within this agreed amount, it's fine. But here's the thing: information on agreed price increases can't be hidden away in the small print where you might miss it. Everything you're agreeing to should be made clear before you sign up.
3. Prices go up in line with inflation or tax rises.
Providers can put up their prices if tax rates go up, or to keep in line with inflation. You can only leave penalty free if the price hike goes above the 2.5% allowed for inflation. Even fixed-price deals can be hit by this, as long as it's stated in the contract terms, so be sure to check the small print.
Other mid-contract price rises
Price rises aren't just limited to the ones that are written in your contract. Broadband providers might still jack up their prices for any number of reasons. Perhaps they want to bring you in line with their revamped pricing structure. Maybe they're improving the service, like making it faster. Or maybe they just need more money.
Whatever, you don't have to accept these increases. If it wasn't what you signed up to you have the right to cancel your contract without paying a penalty.
What needs to happen when the price goes up?
When your ISP decides they want to hit you up for a little extra cash, they must inform you in writing 30 days before the new prices come into effect. Make sure you keep an eye out for the letter or email because the timing is really important.
If you're eligible to leave mid-contract you will need to inform your provider during this 30 day period. If you wait longer than that you're effectively accepting the new prices and are stuck with them until your deal ends.
How you can cancel your contract without penalty
So, you've received a letter telling you that your broadband prices are going up, and by a larger amount than what you agreed to. You now have the right to find a new supplier, and you won't have to pay a termination fee even if you've got still got months left on your deal.
What you need to do is inform your provider of your plan to leave. Send them a letter or email, or give them a call to start the process in motion. Make sure to mention that you're leaving because of the price rise. You must do this within 30 days of receiving the letter informing you of the price rises. This is a legal right, so you shouldn't face any obstacles.
What are your options?
When you tell them that you're leaving, your provider might offer you a deal to get you stay. If you're happy with the service you've been getting then by all means try and negotiate for the best deal you can get. But remember, it's easy to switch broadband providers these days. Don't assume that staying with your old provider is the simplest option.
At the same time, start looking for a new package. Use our postcode checker to find the best broadband deals in your area. Providers reserve their best deals for new customers, so you should be able to save a heap of money over what you're currently paying. You can also use these prices if you decide to haggle with your existing provider instead.
Price rises are going to hit all of us eventually. But you can minimise the risks while shopping for a new deal. Some suppliers, like TalkTalk and Plusnet, are starting to offer more fixed-price deals. You can also pick up some fantastic introductory offers, with very low prices over the first year.
Click here to compare broadband prices and start shopping now.