Beware the Buyout

In your merchant account agreement there is an option for you to cancel your contract before its due date and there is no fee of course, right? Of course there is! This ain't the March of Dimes, baby. You want out early, you pay them. It's part of the convenience principle which means to make it easier it costs you more.

Take care. There are many groups out there that will say they will buyout your cancel option (they will pay whatever fee is charged). This may be true and it may be bogus. Unfortunately I hear of too many cases where it is bogus. As for the ones who will pay the fee, do not expect this unless you are doing some kind of great numbers every month.

Now for those that say they will and do not, there are plenty.There is an industry magazine that I do not suggest you read. If you are not in the industry and attempt to read this periodical, you will spontaneously hemorrhage from your eyes out of boredom. We who are in the business are inoculated against this, but the reading still hurts. Anyhoo... There are often cases cited where some group said they would pay the fee for the customer and never did. Unfortunately, this leaves the customer with two sets of bills every month and not a lot to do about it. It is a big industry no-no, and legal clamps can come down upon them for doing so. The problem is that those clamps take far and long to activate and they have to have done it to a bunch of customers.

In the end, just be very wary of such an offer, especially if you are not doing a lot of credit card sales each and every month.