If you’re like most people, you’ve probably upgraded your phone contract at least once or twice. This has been a routine for many users who want to keep their phones up to date to whatever new offers come out in the market. With an upgrade, you essentially pay for a subsidized cost of the latest handset. This means you’ll pay for a higher monthly fee and your contract extends for another two years.
If you have bad credit, however, upgrading won’t be a smooth sailing process. Most of the time, you’ll have to do with the available bad credit contract phones in the market until your credit rating improves. Other times you may need to switch to a no-contract phone option especially if your financial situation calls for you to do so.
If you’re thinking of switching from your contract phone to a no contract one, here are things you need to know about.
What are no contract phones?
When you opt for a no contract phone, as opposed to a contract phone, you will essentially have to pay for the device’s cost upfront. Instead of a subsidized monthly fee for 12 or 24 months, you have buy the phone the upfront and then pay for the services used per month. For many providers, you are allowed to ditch the service anytime you want since the phone has been fully paid.
How is it better than contract phones?
While no contract phones will need you to have sufficient cash upfront to pay for the phone, it is still better option in certain occasions for several reasons. For one, you aren’t going to be hooked to a lengthy contract. Some providers, for example, will need you to pay for the phone then subscribe for one month. Once the first month is up, you can ditch the contract at any time you chose to.
Some providers, however, limit this no contract option to certain phones. This means you may not be able to avail the latest handset after all. Other providers also offer a twist to the no contract plan. Rather than pay for the phone outright, you can opt to provide a down payment which will reduce your monthly dues for the next 24 months. At other times, you can bring your own phone. Just make sure your unit is compatible with the provider’s services.
Should you opt for a no contract phone?
Because no contract phones require you to pay for it upfront, it won’t always be the best option for everyone. It is, however, worth considering if you have bad credit and you’re certain that you won’t get approved for traditional mobile phone contracts. If you have cash you can spare, this is also the best route to take since you won’t have to worry about lengthy contracts, extra charges and hidden fees. Cash, therefore, is the main deciding factor if you are considering whether a no contract phone is right for your or not. If you have cash, it makes perfect sense to go for it because then you’ll be saving more on your phone bill in the end.