1st time credit refused?

Amethystrose63

My son age 19 applied for his first ever contract phone a week after he started his first job. He has never applied for any kind of credit previous to this and unfortunately his application was declined. Is it because he had only just started work? How do we find out why it was declined? Thanks

[Deleted User]

Lack of credit history and short employment will be the reasons. But you don't get to find out the reasons.

If he can control himself, get him to apply for a credit card with his bank and see if he can use that sensibly to build up a credit history.

DCFC79

If he has savings he could buy a phone outright and get a sim only plan.

phillw

If you haven't already, ask the company why they declined him. They might not tell you anything useful, but in any case you should follow this guide as it will help in the future.

http://www.moneysavingexpert.com/loans/credit-rating-credit-score#boost

Is he currently using pay as you go? In which case it might be worthwhile switching to a sim only contract to build up a relationship with an operator. As their liability is quite low then they are more likely to take a punt. While lending someone £600 to buy an iPhone that they might never get a single payment for is not worth the risk.

https://shopmobilephones.co.uk/mobiles/bad-credit-contracts/phone-contracts

If he has a working pay as you go phone then get it unlocked so you aren't restricted to which networks you can use. http://www.moneysavingexpert.com/phones/unlock-mobile-phone

If you need a new phone then you can get an unlocked phone pretty cheap.

http://www.amazon.co.uk/Nokia-Lumia-530-SIM-Free-Smartphone/dp/B00MWNWDD0/ref=sr_1_5?s=telephone&ie=UTF8&qid=1447417945&sr=1-5&keywords=lumia+sim+free

It's not an iPhone (or whatever phone he tried to get), but he's 19 and only been working for a week.

If he applies for something like an aqua credit card then he can use that to buy a cheap phone and show that he can pay the money back and build his credit score for the future.

If he builds a decent credit history and doesn't do anything stupid then for is next phone he'll be able to get a 0% purchases credit card and buy the phone that way, rather than taking out what can be an expensive loan (i.e. the contract). Alternatively just save up for it.

Ben8282

One obvious thing would be that he is not yet on the electoral roll.
I think this is most probably a case of a young man who has only been working for a week going out and trying to buy himself an expensive phone probably with a quite high monthly payment. Has he really demonstrated that he can afford and maintain the payment?

mwarby

DCFC79 wrote: »

If he has savings he could buy a phone outright and get a sim only plan.

Sim only plans have the advantage of showing on credit history(so building a score) and being very easy to get (I got one just after my IVA, which meant I had a terrible score)

Thrugelmir

Amethystrose63 wrote: »

Is it because he had only just started work?

Highly likely. A contract is a commitment that cannot be walked away from. Suggest he reapplies once established in the job.