Mobile phone contracts have become very popular across the UK and many other parts of the world. People are increasingly going for cell phone contracts because it gives them the ability to get access to a brand new phone of their choice and also a bundle that meets their monthly needs. However, having bad credit seems to have thrown a spanner in the ability of individuals to get access to a cell phone contract of their choice. Whether you have bad credit or not, there are two kinds of cell phone plans at your disposal. You can either go for a Pay As You Go (PAYG) plan or a mobile phone contract.
A Pay As You Go plan is more like a prepaid plan where you have to pay in order to make use of your phone. This plan is more or less like a debit card that requires you to load the card first before you can make use of the card. This option is good if you have money in advance but can be a pain in the neck when you are struggling financially. On the other hand, a mobile phone contract is like a credit card where a credit limit is put in place and you can use it and make payments later. This type of contract is popular with most people in the UK because it gives them an opportunity to use their mobile phones and thereafter make payments.
Conversely, with prepaid mobile phone plans credit checks are not performed as you do not pose any kind of risk to the mobile phone providers. Mobile phone contracts on the other hand attract credit checks because providers need to be sure that you have the ability to be making monthly payments and that you do not pose a risk to them financially. For people with a healthy credit history, getting approved for a mobile phone contract is pretty much a guaranteed thing. On the other hand, if you have bad credit getting approved for a mobile phone contract is a herculean task. In fact, you are bound to face rejections every now and then which essentially negatively impact your credit score further.
So what do you do when every door to get a mobile phone contract has been closed? Your answer is bad credit phones. Bad credit phones are specifically designed for individuals who have bad credit and who occasionally get denied a mobile phone contract. While these phone plans have been a blessing of sorts, there are a number of things that individuals applying for them need to know. For starters, there are a number of providers that require a person to make a deposit before they can be approved. This is one way of providers offering bad credit phones mitigating the risks.
Secondly, the perks provided in this kind of plans are never as good as for those with a good credit history. However, with a bit of haggling here and there, a person can be able to negotiate for themselves a good deal. Thirdly, you have no say in the contract period you will be locked in. There are some providers who demand that you commit yourself for 18 months while others demand 24 months. The downside is that you are locked into a contract for an inordinately long period of time. On the positive side though, depending on how good you are at negotiations, you can actually be able to get yourself a good deal and even upgrade after a few months provided that you are timely with payments.