When a person has bad credit cell phone contracts with reasonable terms are hard to come by. To alleviate the problem, the individual can work on improving their credit history, and purchase one of the many pay as you go cell phone plans in the meantime.
Pay As You Go
These are cell phones which are purchased on a monthly plan for a set up cost and varying fees. The amount of the monthly payment after purchasing the phone reflects the number of minutes, or ‘airtime’ desired. Additional airtime cards can be purchased whenever needed. Credit checks are irrelevant for these plans, and local ‘big box’ stores will typically have an extensive selection of the latest phones.
Solutions
Although shoppers with bad credit can find a contract, they are likely to be penalized for their poor history. Do not leave this option out, though. Take some time to compare the offers from major cell phone providers; if you find a good deal this way, the search is done.
Once you have shopped to your satisfaction and have not found a good plan, consider getting help. A co-signer is one acceptable method of signing up for a good plan, provided they have good credit ratings. This is an excellent solution when the parties trust each other and the co-signer is confident the person will pay on time.
Another possibility is to pay a higher up front cost. If the buyer’s credit is particularly bad, the company may require them to pay the entire year up front. The relative cost of paying a lump sum could be less than the frequent expense of purchasing airtime cards. If you have the money this is a practical consideration.
Fix Credit
Depending on the amount of time spent on a phone, pay as you go plans can get excessively expensive, so if you purchase one, immediately set about working on your credit score. Generate a list of all outstanding debts, and prioritize the order of payments. Contact any creditors whom you are late paying, and do not deviate from the schedule.
A steady history of paying on time will gradually improve credit, especially if new lines are maintained. Collections do not disappear without taking action, however, so deal with these as soon as possible. It is important to pay all bills on time, even household bills, to maintain the best credit score. Get in the habit of checking your credit report every three to six months, and address any errors found immediately.
Bad credit cell phone contracts are attainable, but weigh the cost of pay as you go phones as well. Calculate the amount of time you actually talk or text and then decide which plan is the superior option. With airtime cards, the user is limited to the number of minutes they purchase. However, this prevents the person from going over their allotted time and racking up a large bill at the end of the month.
Finally, when signing a contract or buying airtime minutes, look for unlimited plans or purchase more time then needed. To be prepared, it is always better to have extra time than to run out in an emergency.
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