Five Things You Should Know Before You Sign Your Next Contract

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ContractIn an ideal world, you’d have a lawyer at the ready to review everything you want to sign. As we’re dreaming, let’s also conjure up the dream house with kids who always eat everything you cook for dinner and who never lose their mittens the first week of winter. Just my dream?

In real life, you agree to contracts every time you buy a new phone, set up cable service or choose a new form of marketing for your business and you don’t have the time or money to have a lawyer review EVERYTHING you sign. So….I’m going to let you in on some secrets to look for in every contract you sign or click yes to.

  1. Who am I doing business with?

This is always my number one question because it affects how likely I’m going to be happy with this new agreement and how easy it will be to deal with any problems that come out of it. Is the other party (that’s fancy speak for the other person or company in the agreement) a person or a corporation? Where are they located? Did an agent do all the selling but they’re not mentioned anywhere in the contract? What you’re trying to find out is: can I get at this person if something goes wrong? If the party at the other end seems at all shifty or the contact details are hidden, think twice before signing.

  1. What’s in it for me?

You’ll want to know what the scope of the contract is. Look for words which detail what you will be receiving; the more specific, the better. If you’re receiving actual products, look for quantity, description, model numbers, colour etc. If you’re signing up to receive services, how are the services described, how long will you receive them, how will they be delivered. You need to have absolute clarity about what you expect to receive after you pay your money. If you have any questions about what you’re getting, clarify with the other party before you sign and make sure those clarifications make it into the written agreement.

  1. Are there any guarantees?

What are my favourite words in a contract with a reputable party? “Money-back guarantee”. Close second? “Satisfaction guaranteed.” You won’t get this is in every contract but look for clear promises of satisfaction and for mechanisms to make you satisfied if your first experience isn’t a great one. This is linked to tip #1 as businesses with great reputations for customer service will make sure that you end up happy with them. Businesses that are big on selling but vague on what they actually promise to deliver are best avoided.

  1. How do I get out of this?

I get anxious when I’m in crowded areas. As a way to cope, I always look for the closest exit to me and figure out how I would get out of Dodge if something were to go awry. You should have the same approach to contracts.  Before signing anything, look for the termination clause. It should provide a way for you to pay your way out of the contract through a termination fee or by providing a certain number of months’ notice. If there is no way out of the contract but to continue it, think extra hard about whether you want to sign it, especially if you’re going to be stuck for a long time.

  1. What’s the worst that could happen?

As it says on the tin, you should ask yourself, what is my worse-case scenario in signing this contract or clicking on the “Buy” button. If the worse thing is you might get something you don’t particularly like but you’re only out a few bucks, it’s probably worth the risk. If, on the other hand, you will have signed up for something for two years that you can’t get out of and it will cost you $20k by the end of the term, that’s when you keep calm and call your lawyer. Or keep calm and keep your $20k.

If you are still confused about contracts, please click on the button below to schedule a complimentary consultation with Andrea.

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