Your rights regarding deposits for service
Your phone company may only ask for a deposit in specific circumstances and there may be alternatives to paying a deposit.
The phone company may ask you for a deposit if you do not have a credit history with the company and you cannot provide satisfactory credit information, you have a poor credit rating with the phone company, or you otherwise pose a high risk of not paying your telephone bill. The deposit, where required, generally does not exceed the total of three months' phone charges from the company, including charges for local phone service and any extra services you decide to purchase, such as long distance service and optional local services. The phone company must inform you of the reasons for asking you to pay a deposit and explain that there may be other options available. For example, you can arrange for someone else, who has a good credit rating with the phone company, to sign a contract with the phone company, agreeing to pay your bill if you don't. This person is called a guarantor. You can also have someone else pay your bill for you. Another option is to get a letter of credit from a financial institution. You earn interest on deposits that you have paid to the phone company. The amount of your deposit and the interest you have earned will periodically be shown on your phone bill. The phone company must periodically review the need to keep your deposit, or the alternatives to the deposit. If the reasons that justified the need for your deposit are no longer present, the phone company must return your deposit, and any interest, to you promptly. If you cancel your service with your phone company, your deposit plus interest will be returned to you, less any amounts that you still owe.
* The rights summarized in this guide are for informational purposes only and do not represent a complete list of your rights. The information contained in this guide may also be subject to change. This guide does not change or add to any existing rules or laws. In the event of any inconsistencies between this guide and any existing rule or law, the existing rule or law will prevail.
Date Modified: 2006-12-21