Beginner's Guide to Phone Contracts

With reports claiming that more and more people are overspending on their phone bill, it’s no surprise why plenty of subscribers are thinking twice when applying for a contract phone plan. If you have a poor credit, chances of your application getting approved fast are even lower. Fortunately, there are phone deal offers such as bad credit phones specific for customers with bad credit problems.

Whether you have good credit or bad credit, here’s your beginners guide to phone contracts to guide you as choose your contract phone plan.

What are phone contracts?

Phone contracts are phone deals where you agree to pay for a monthly fee for the duration of the contract term. In exchange, you’ll get a contract plan that includes a handset and a bundle plan. If you have a good credit score, you can practically choose any handset you have in mind including the best and latest releases from big brands such as Apple and Samsung among other brands. You also get to choose a bundle plan tailored according to your monthly needs for calls, texts and data. To compare the best bundle plans available in the UK today, just go to http://www.moneysupermarket.com/mobile-phones/.

If you have a poor credit score, on one hand, you still get to choose a handset as part of the contract plan but the choices may be limited. To increase your application’s chances for approval, you may be better off sticking with budget-friendly handsets. Keeping your bundle plan reasonable and less generous will also lower your monthly fee. A lower monthly fee usually means you’re application is likely to get approved quickly.

How long do contract terms last?

Most phone contract terms last for 24 months. This means that you’ll have to commit to pay a fixed fee per month for the next 2 years. If you delay or miss a payment, you may incur penalties, which can hike up your payables. If you want a shorter term, there are phone contracts that last only for 12 months but the monthly fee may be more expensive. There are also phone deals that last longer, usually for 36 months, which means monthly fees are cheaper. For mobile users with bad credit, the typical contract is 24 months with a privilege to upgrade to a better package provided that you are a good payer.

How much does a phone contract cost?

The cost of your phone contract will vary from deal to deal. Whichever deal you opt for, it would help to keep in mind that your monthly fee is affected by two factors. One is your handset choice and the other is your bundle plan. If you want a cheaper monthly fee, you’d want to pick a cheaper handset and a less generous bundle plan. But also remember that cheaper is not always the best option especially if you’re a heavy mobile user.

In any case, the trick is to find a plan that is not just the cheapest but is also best suited for your needs and budget. While you’re at it, you’d also want to go the extra mile and investigate your contract phone’s hidden fees.

Are phone contracts for everyone?

It's true that phone contracts have a number of advantages you can enjoy but it’s also worth noting that this type of phone deal is not always for everyone. If you’re going to apply for a phone contract, make sure it’s suited for your needs. Otherwise, you may end up like most people, overspending on their phone bill because they were not careful with their phone contract choice.