Will My Credit Score Hinder Me From Getting a Phone Contract?
In this day and age, we are all expected to have a mobile phone of some kind for work, our social lives, and general safety. There are plenty of phones to choose from and plenty of phone providers around the country – but that’s only half the puzzle.
One thing that can seem like an issue is whether or not our credit scores will stop us from getting phone contracts set up in the first place.
Credit scores are checked for nearly every big purchase and contract, so it’s only natural to assume that they would be questioned when it comes to signing up for a year or so with a phone network. But, will your credit score stop you from getting a phone contract?
Will a Bad Credit Score Stop Me From Getting a Phone Contract?
No, a bad credit score will not necessarily stop you from getting a phone contract. In fact, in some cases, certain phone companies won’t even check your credit score at all.
However, most phone companies do check credit scores and retain the option of signing a contract with you or not. It’s worth looking into the expectations of your chosen phone provider if you’re really concerned.
Thankfully, that isn’t the be-all and end-all. You have other options if one phone company does not accept you and your credit score. For example, it may even be worth looking into a SIM only deal or a pay-as-you-go option while you search for a solution.
What Can I Do if I Have Been Denied a Phone Contract Due to My Credit Score?
If one particular phone company has denied your application for a phone contract, then you may simply try with another. No two phone companies will have the exact same criteria, and, generally speaking, there is no minimum credit score number you need to be considered for such a contract. However, do remember that failing a credit check will show on your credit report – meaning it’s worth treading carefully.
It is important to remember that you are applying to be a long-paying customer. Although some phones and specific contracts can cost quite a lot, it is nowhere near the same as asking for a payday loan. That is why, generally speaking, phone operators are happy to take on new clients whether their credit history is good or bad.
However, before applying to just any phone company, look into them thoroughly first. Do not try with just anyone in search of a contract! It is essential to ensure that you are getting the best deal for yourself and that it is one that you will want to keep long-term. Switching phone providers over and over will negatively affect your credit score and could affect your getting a decent phone contract.
As mentioned above, should your credit score be a real issue, then you can always get pay-as-you-go SIMs. These are contract-less phone services you can find offered in many supermarkets and shops. You can pay anything from around £10 upwards to get a certain amount of data, texts, and calls. This way, you do not risk your credit score and can ensure that you have a phone without needing a contract.
However, it does mean having to recharge your credit as frequently as necessary, and it can be a real pain when you run out! You’ll also need to have an unlocked device before you can use a new SIM – so check your handset carefully.
Should I Apply to Multiple Providers at Once?
No, always avoid applying to multiple providers at once. While applying to one or two won’t appear too shaky, remember that each new application may demand a whole new credit check. Every time your credit is checked, it affects your credit score. So, applying to multiple phone companies at once could severely impact what you can and can’t borrow in future!
Instead, the best thing you can possibly do is research the providers, their policies, offers, and reviews before committing to anyone. Then, only apply to the network you are interested in, or the one that appears to offer the best deal. Should they reject your application, then try with someone else, and so on and so forth. The good news is it shouldn’t take you long before you find the right provider for you.
Will Having a Phone Contract Affect My Credit Score?
Generally speaking, yes, having a phone contract will affect your credit score. In fact, having a longstanding contract with one phone provider can be a good way of improving your credit rating. Conversely, changing providers frequently and having multiple credit checks will have a negative impact on your credit score.
However, it is vital to note that as much as a phone contract can affect your credit score, it will not significantly affect your credit in the same way as an online loan might.
Having a regularly-paid, long-lasting phone contract can help you build enough credit to get a credit card, for example. However, it will take time for it to build enough of a score to have such an impact.
That being said, your phone contract won’t do enough for your credit score to get a mortgage, for example.
However, there is no downside to having a longstanding phone contract. As long as it suits your needs and budget, it can only benefit you and your credit score.
A Conclusion on Phone Contracts & Credit Scores
Having a phone is essential nowadays, so it can be a bit daunting to think that we may have to go without it due to our credit scores.
Thankfully, however, as you can see, that is not the case. Even with a poor credit score, you can still get a perfectly good phone and contract at an excellent price. It just means having to shop around a little!
Finding the right provider can take a bit of time, and it’s definitely worth looking online at reviews and checking with those around you about their experiences with their providers before making your final choice. Otherwise, leap onto a pay-as-you-go SIM for a while and protect your borrowing potential until you’ve healed a little.
If you’re looking to buy a phone outright but need some instant cash to purchase it, you can apply now with LoanBird and check your eligibility with no impact on your credit rating.