There are two problems with this whole deal. First is something our law calls "reasonable expectation". Now, I don't know if the US have something similar in place, but if not, at least not acting in the spirit of that law makes you a pretty big asshole. The deal here is that when you enter a contract, you have a "reasonable expectation". When I hire a tiler, I do reasonably expect him that he knows how to do it, that he brings his own tools, that he will cover my floor and/or walls in tiles (and not, say, mortadella). Anything that I may "reasonably" expect but is NOT the case has to be explicitly stated and, depending on who are the parties in the contract, may need to be printed out boldly and signed separately, just to be sure it's not hidden somewhere in the legalese bull. When you enter in a deal with a party that advertises something in one way and then it turns out it's exactly the other way around, it's at the very least deceptive.
The other, and bigger, problem is that it's due entirely the moment you decide to leave them. That allows them to force their poorer customers into staying because these people cannot afford to pay off 200+ dollars NOW.
Now, as odd as it may sound, I wouldn't have so much of a problem with the first issue. There's nothing wrong with selling a phone in installments. Cars have been sold that way for decades, why not phones? The problem is rather that people who have to buy a phone on installments are also the same people that can't simply cough up the rest of the amount owed instantly. Else, why the installment in the first place? These people are locked into a contract they can't get out of because they simply cannot afford it. There would nothing be wrong if the installment plan simply kept running for its allotted time, the really deceptive part here is the "stay or pay" gun to the chest.
I confess I don't understand your logic at all. If they were violating the principle of reasonable expectation I would have a big problem with that, but they aren't (read most of the posts here). If they are demanding that you pay the balance due on your loan I don't have a problem with that either. You knew what you were signing up for, they subsidized your goddamn phone (0% interest) and you canceled the revenue stream side of their business. In exchange they asked for you to pay the balance of your loan. You could certainly sell the used phone (according to posts here, they will even buy it back from you) and use that cash to pay off the loan. It's hardly usurious at 0% interest.
From a practical point of view, if you signed up for a $50 / month plan, you are unlikely to have problem raising the $200 remaining. The gun at your chest is a water pistol. If your balance is really only $200 and you walk away, you will not get pursued by goons, but you might suffer a hit to your credit rating -- exactly as you would reasonably expect. I understand about hard times, but I don't see this as being a problem legally, morally or practically. I think it's a case of the USA phone system distorting reality for so long that people no longer understand how things are supposed to work.
I did like the mortadella line.
