Several kinds of legal disputes can involve merchant processing. One such dispute includes early termination fees. In these cases, businesses or individuals try to cancel their Merchant Processing Contracts but cannot do so without being charged a cancellation fee. Unfortunately, most of these contracts include a personal guarantee clause, meaning that even if the business or bank account closes, the contract can follow the individual personally.
If you are trying to avoid being charged an early termination fee, or your merchant processing contract specifically states there is no such fee, but you are still being charged one, Sigal Law Group can help. Our experienced merchant processing litigators will work diligently to review your case and present your claim, guaranteeing you the best possible outcome for your case. Contact Sigal Law Group today for help.
Early Termination Fee Laws
There are two types of early termination fees in merchant processing. The first is a flat fee your processor will charge when you cancel your merchant account. This fee is decided on beforehand and specified in the Merchant Processing Contract. The other kind of early termination is liquidated damages.
In the case of liquidated damages, the individual or business will be charged an amount decided on by the merchant processor after the account is closed. Generally, this is the amount of revenue they believe they will lose when you close your account.
For example, if you have a two-year processing contract and you cancel after a year, the merchant processor will value your cancellation fee as the one full year of processing costs they would have received had your account stayed open.
Litigating Early Termination Fee Issues
Clearly, early termination fees can be extremely costly for individuals and businesses. Thus, it is very important to work with a skilled merchant processing attorney to determine what claims you can make against the merchant processor to avoid such fees.
At Sigal Law Group, our merchant processing litigators have years of experience helping individuals and businesses avoid early termination fees, get back early termination fees that were improperly processed, and prevent further issues from affecting them. Contact Sigal Law Group today for help.
