Discover tips and tricks on how to save and invest money by Oval Money

“Never sign anything you haven’t read” is one of the first rules of common sense.
In fact, you might think it’s one you always abide by – but that’s unlikely. Here are some of the contracts we routinely sign without fully reading or understanding them.

1. Online terms and conditions

Consumer “user agreements” are an annoying by-product of the internet age, with devices, streaming services and even websites requiring you to deposit your email, check some boxes and click “agree” before you can use them. Be honest, have you really read any of the pop-ups about data collection since GDPR came in? Probably not, as Google has been found to actually be benefiting from the law coming into action.

You can find some surprising clauses in T&C agreements (like handing over your first-born child), if only they were short and digestible enough for you to actually bother reading them. You might remember the surprise of Bruce Willis who, in 2012, discovered that the vast collection of music he had ‘purchased’ through iTunes… didn’t actually belong to him, and he couldn’t bequeath it to his daughters in his will. It was all in the small print, Bruce.

There’s also the issue of hidden fees or recurring costs. You might think you’re just signing up for a free trial or sample, but if you don’t read what you’re agreeing to then you can easily find yourself being charged for an expensive product or subscription that you didn’t even want.

Before agreeing to any online trial, sample or service, read what you’re signing – especially if you’re inputting bank details. Check things like who owns the rights to artwork that you share, what data the company is collecting about you and what the policy is about deleting your data, content and account.

At Oval we have made our Ts&Cs as simple and clear as possible so you know exactly what it means to be a MoneyWise saver. You can also access them any time you want through your personal profile.  

2. Loans with or for other people

Sorry to burst the altruistic bubble, but helping people out by co-signing a loan with them or agreeing to be a guarantor is often a fast-track to ruin, especially if you don’t fully understand the obligation you’re making. It’s one thing for married couples or civil partners (who have certain financial responsibilities to each other from a legal standpoint anyway), but very different for a friend or relative.

Depending on the specifics of your agreement, if the primary borrower skips town and stops making payments, a co-signer or guarantor is on the hook for those repayments. Co-signers commonly believe they’re only liable for “their half” of the bill, but this isn’t the case. Guarantors often think that their role is only to vouch for the person signing the contract, and don’t realise they’re agreeing to step in if the money falls short.

If you can’t afford – or simply don’t want – to be responsible for someone else’s contractual payments, there may be other ways you can help them. If you’re happy to proceed, make sure you read the terms of the agreement carefully and fully understand how much you will potentially be required to pay, and for how long.

3. Job contracts

When it comes to changing jobs, most of us are in a position where we’re just grateful to be employed. This often means that we give new employers the benefit of the doubt – they seemed nice in the interview, so why shouldn’t we trust them? The fact is, there can be all sorts of unpleasant surprises lurking in an employment contract that may have been fudged – or avoided completely – during your meetings.

For example, they might say that salary and raises are awarded in line with their pay policy document… but without reading it, can you even be sure it exists, let alone that it works in your favour? What your new manager says about overtime and dress code might sound good, but is it supported by the document you’re signing?

Really unscrupulous employers will try all sorts of shady tactics, like tricking you into signing up for a lower pay (or offering confusing commission structures), including “at-will” clauses, questionable confidentiality and non-compete requirements and much more. Brush up on potential red flags and know that you should never feel pressured to sign an unfair deal.

Is a contract always binding once it’s been signed?

Contracts are binding once they have been signed, even if the signer didn’t read it properly or didn’t fully understand it. However, there are some cases that offer the opportunity for the contract to be invalidated.

For example:

  • Cooling off periods. Some contracts include a cooling-off period during which the signer can change their mind with no repercussions. This is common in internet or phone contracts, land purchases, door-to-door sales purchases and a few other scenarios – but not all. The periods can vary from a few days to several months and opting-out usually requires formal written notice.
  • Misrepresentation. If the other party is misleading about what a contract is, what it contains or what its effect may be, then the contract may not be legally binding (however, this can be a grey area if the document itself is clear and the signing party neglected to read or challenge it before signing).
  • Implicit or explicit conduct. Where it’s clear that the signing party does not understand what they are agreeing to (for example, the document being signed in a foreign language or despite other impairments) and the contents of the document are radically different from what was verbally described or translated, it may not be binding.
  • Agreement to cancel. In some cases, both parties may simply agree that neither of them wishes to proceed with the deal, in which case, the contract may be dismissed.

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