Other than your personal loan applications, your bad credit score can also affect your mobile phone contract applications. Major carriers in the UK are less likely to approve your application because you pose a high risk on their profitability. Does this mean you shouldn’t apply for a phone contract anymore? Not exactly! If you really want a phone contract because it suits your needs; there are some things you can try to offset your bad credit issues. Here are some things you can do:
Don’t choose a high-end handset
You may have your eyes set on the latest high-end iPhone or Samsung Galaxy but this is not the time to prioritize your handset choice. Because you have bad credit to consider, it’s best to stick with a cheaper handset for your phone contract. This way, your monthly fee will be significantly cheaper. A cheaper monthly fee means fewer risks on your carrier thereby increasing your chances for approval.
If you do get approved for a phone contract, make sure you pay your monthly bill on time. Once the contract is up, your credit score should see some significant improvements and you can upgrade to a better phone at this point.
Consider paying an upfront fee
If you have cash you can spare, it wouldn’t hurt to offer to pay an upfront fee. Some high-end phones have required upfront fees while most phones are offered for free. Either way, you can pay an upfront free more than what is required to convince your carrier that you’re not a high-risk customer. By paying the upfront fee, it will significantly lower the cost of your monthly bill consequently improving your chances for approval.
Find a guarantor to back your application
If you don’t have cash you can use to cover for the upfront fee, you can always try to bring a guarantor to back you up with your application. With a guarantor to co-sign the contract, the risks are pretty much negligent on your carrier’s end. Even if you can’t pay the monthly phone bill, your carrier will have your guarantor as fall back. The guarantor is required to pay for your liabilities as per the credit agreement.
Not all carriers may accept a guarantor. Make sure you get in touch with customer service for more info. As for your guarantor, you need one who is a UK resident, of legal age and has a good credit score.
Choose a SIM only deal
If you have a decent handset that is working perfectly, you might want to consider getting a SIM only plan instead. SIM only plans work just like your traditional phone contracts but without the handset offer. You need to bring your own but you get to enjoy the same affordable rates on your call, text and data services. Most SIM only deals have 12-month terms but there are now one-month deals for people with bad credit.
Check out guaranteed phone contracts
Last but not the least, you can always check out guaranteed phone contract deals. These deals are specially offered for customers with bad credit issues. There are no credit checks required hence approval is almost always guaranteed. It also works just like regular phone contracts. You can choose your handset as well as your phone bundle. But this time, the handset selection is limited to cheaper and older models. The cost may also be different than usual. Because you have bad credit, expect the associated charges to your phone contract to be higher.