Why Was My Application for a Cell Phone Contract Declined?
Staff Writer / 04-11-2019 / Tips
If you’ve ever had an application for a cell phone contract or deal declined, you know it can be a frustrating but also confusing feeling. In most cases, you’re not even sure why your application was declined. The truth is that it all comes down to your credit score and if the network thinks you qualify for a particular deal based on that score.
If you have faced the dreaded decline from any of the network providers, it simply means that your credit profile has not met their requirements. This can mean many things. It’s possible for a consumer to be totally debt-free, which means they hold no credit accounts and have been dealing with cash all their financial lives. While this is great financial practice, creditors are reluctant to offer credit to a consumer who has no record of consistent monthly payments. Creditors need to be confident that the user will pay any credit owed, and if there is no prior history to assure them of this, a cell phone contract application could potentially be declined.
The other scenario is if a consumer has bad credit. This simply means that the person has taken on too much credit and can’t afford to pay all of it back. Missing a monthly instalment affects your credit score negatively and lowers your chances of landing the cell phone contract you want. It makes sense for creditors to decline a user that has defaulted on their payments as it indicates that there is a possibility their money will not be paid back.
The same principle is applied to cell phone networks. They offer contracts to consumers they are confident can afford the monthly payment for the duration of the contract period, therefore, your credit score has to be desirable. The networks will decide, based on that score, the range of contracts you are offered.
You could also be declined for a cell phone contract if you have a judgement against your name at the credit bureau or if you are under debt review. Debt review is the process in which a debt counsellor has to negotiate better interest rates and lower premiums on behalf of an individual because their income is far less than their expenses and they are unable to meet all their credit obligations. If a person is undergoing debt review, they will not be able to qualify for any form of credit, including a cell phone contract.
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