Being turned down for a mobile phone contract because of your credit rating is a frustrating experience. The easiest thing to do is get a pay as you go phone.
However, for those looking for contract phones with a history of bad credit as a result of a missed repayment in the past year, or worse bankruptcy or a County Court Judgement, it can be tricky.
Unlike taking out a mortgage, loan or credit card, a mobile phone contract may not seem like something you need to apply for. A common misconception is that you can just get a mobile phone contract as long as you have the money.
Mobile phone networks who provide the contract or the phone shop you are buying the contract through will do a credit check to assess how likely it is you'll be able to keep up with payments each month.
They are also checking the likelihood of you committing fraud. Your credit rating is really the only way they can assess this.
If you have missed payments on your credit card or any other bills, this will bring your credit score down, as will having an unreliable source of income.
For instance, if you are on a zero-hour contract this could lower your chances of being approved for credit or taking out a mobile phone contract. Reliability is key to provider of mobile phone contracts and credit, so they may also take a dim view of someone who moves house regularly.
You can see all our contract phones by following the link below.
All of these things can affect your likelihood of approval, but you can read more about what to do if you've been refused credit to see how you can start making improvements to your credit score.
Alternatively you can get a £2 statutory report from each of the three agencies - Experian, Equifax and Callcredit - to see what the lenders see.
If you want to get a mobile phone contract and do not feel a pay-as-you-go mobile phone is a good enough alternative, there are some things you can do to improve your chances.
Firstly, if you've never seen your credit report and score then it's worth checking it through one of the main credit reference agencies. If you're not sure about paying the monthly fee for one, then consider looking up free credit reports but, with most things that are free, there are some limitations.
Either way, you can get an idea of where your credit score is failing so you can make improvements to it before you apply for your next mobile phone contract.
You can also apply for one of the low-end mobile phones on the market. Mobile phone network providers see a bigger risk in giving someone one of the high-end newer models on a contract, so go as low as possible to increase your chances.
No credit check mobile phone contracts will often include an outdated mobile phone model
Likewise, sim-only contracts are better for people with bad credit as there's no mobile phone involved in the deal. The mobile phone makes up much of the risk involved with a contract, so when you're only paying for the network the risk goes down.
Aside from this, there are some actions you can take, if you haven't already, to improve your credit rating.
It's worth making sure you are registered on the electoral roll at your address and set up direct debits to stay on top of all of your outstanding debts to prevent yourself from missing any repayments. You can see our guide to improving your credit rating for more ideas.
Beware of companies that say they can give you a mobile phone contract without any credit checks. These contracts come with quite a few caveats you should look out for.
Firstly, no credit check mobile phones are often outdated, so don't expect to get the latest smartphone or even a smartphone. You are more likely to get a heavy build, but perfectly new, mobile phone.
If you want a phone that does more than text and call, then this should not matter to you.
Another issue with no credit check mobile phone contracts is that the price is inflated by the fact that there are no credit checks involved.
Check your credit report to make sure you're in good shape to apply for loans, credit cards, overdrafts, mortgages and mobile phone contracts
You could be paying in excess of £30 per month for a good amount of texts and calls, but for a phone that you could probably buy for £60 alone.
As a result, the value you get will be much poorer than with a mobile phone contract that did require a credit check. You'll also be required to pay for the first month in advance.
It's also worth remembering that you are still signing up for a contract, so if you're not happy with the deal or the phone there's not much you can do until the contract is over.
However, some no credit check deals will let you upgrade to a smartphone after six months or so, depending on how satisfied they are with your reliability.
Paying these bills regularly could make a positive impact on your credit rating with time, so it's worth considering, but just remember to weigh up whether or not you can get better value for money by reviewing your credit rating and making improvements elsewhere before applying for a mobile phone contract.
Use the comparison table below to compare credit reports and see if another look at your credit report could help you improve your chances of getting a mobile phone contract.