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Mobile phone contract after bankruptcy - Guide
alltaken
Posts: 452 Forumite
Just a quick post to let anyone interested in rebuilding a credit history get a foot in the door.
I recently became discharged in October 2016, my credit file is shot - with 4 CCJ's, Bankruptcy and various defaults, I am currently starting the process of correction for those default dates and getting the accounts marked as settled/partially settled. (Thanks to 'Fermi' for the sticky on the board)
During bankruptcy I applied for a Tesco mobile SIM only plan, with the aim of building a post bankruptcy credit history. My ultimate aim is to mortgage via Nationwide with my partner in year 3/4 of discharge. Tesco (like asda) do not credit check 30 day and 12 month sim only plans. This, I thought, was a small step toward gaining green ticks on my file.
I discovered after some time that Tesco mobile had incorrectly advised me on the credit reporting aspect, whilst great that I could take out a 12 month/1 month SIM only plan without a credit check, it was not recorded with any of the CRA's, largely defeating the purpose of continuing with the plan.
Upon discharge I thought I would look at Vodafone SIM only, I did this directly, deliberately choosing the lowest priced SIM plan on offer, a 12 month £9.50 option.
I applied on Saturday, with a few details, name, address etc etc, no employment details were requested, only bank account information for the Direct Debit. To my surprise I was accepted today (Monday) with confirmation of my new number and dispatch.
The reason I chose Vodafone and Vodafone directly is two fold:
1) Unlike Tesco Mobile and a few others who don't credit check, Vodafone do, but most importantly, record account history with Experian! Crucial to a bankrupt trying to rebuild a credit file.
2) Vodafone do something called a 'flex upgrade', this means that with 3 clear payments you can upgrade to any handset based contract without a further credit check, the initial credit check plus 3 payments of £9.50 are sufficient in my case. I verified this with Vodafone a few times.
"As long as you started your SIM only agreement on or after 11 June 2015 you’ll be eligible for a flexible upgrade after 3 months.
Check the start date of your SIM only agreement, and once you reach three months simply log in to My Account or pop in to your nearest store to upgrade."
It enables me to run a mobile phone contract once more, but most importantly it shows stability to other potential lenders via a recorded credit history of on time payments. It also shows my bank (Nationwide) that I am using credit responsibly via direct debits on my account, Nationwide review the foundation account every 6 months to see if an upgrade is appropriate.
I will of course be far more careful with credit after bankruptcy, I will plan each application accordingly, but for those struggling with starting off the rebuild process it looks like a great option. I plan to use a sky high interest credit card in a few months, adding more positive history for my eventual mortgage application. Small responsible steps to getting on the ladder.
Side note: If you do this and go for the lowest priced option on a 12 month contract (I suggest you do), call Vodafone once the order is dispatched/arrives and say you found a better deal with EE/Three etc, they will go above and beyond to add more to the tariff. Remembering that you can upgrade in 3 months should you wish, not tied to Vodafone directly, a third party such as CPW or other outlet could offer a better value upgrade.
I recently became discharged in October 2016, my credit file is shot - with 4 CCJ's, Bankruptcy and various defaults, I am currently starting the process of correction for those default dates and getting the accounts marked as settled/partially settled. (Thanks to 'Fermi' for the sticky on the board)
During bankruptcy I applied for a Tesco mobile SIM only plan, with the aim of building a post bankruptcy credit history. My ultimate aim is to mortgage via Nationwide with my partner in year 3/4 of discharge. Tesco (like asda) do not credit check 30 day and 12 month sim only plans. This, I thought, was a small step toward gaining green ticks on my file.
I discovered after some time that Tesco mobile had incorrectly advised me on the credit reporting aspect, whilst great that I could take out a 12 month/1 month SIM only plan without a credit check, it was not recorded with any of the CRA's, largely defeating the purpose of continuing with the plan.
Upon discharge I thought I would look at Vodafone SIM only, I did this directly, deliberately choosing the lowest priced SIM plan on offer, a 12 month £9.50 option.
I applied on Saturday, with a few details, name, address etc etc, no employment details were requested, only bank account information for the Direct Debit. To my surprise I was accepted today (Monday) with confirmation of my new number and dispatch.
The reason I chose Vodafone and Vodafone directly is two fold:
1) Unlike Tesco Mobile and a few others who don't credit check, Vodafone do, but most importantly, record account history with Experian! Crucial to a bankrupt trying to rebuild a credit file.
2) Vodafone do something called a 'flex upgrade', this means that with 3 clear payments you can upgrade to any handset based contract without a further credit check, the initial credit check plus 3 payments of £9.50 are sufficient in my case. I verified this with Vodafone a few times.
"As long as you started your SIM only agreement on or after 11 June 2015 you’ll be eligible for a flexible upgrade after 3 months.
Check the start date of your SIM only agreement, and once you reach three months simply log in to My Account or pop in to your nearest store to upgrade."
It enables me to run a mobile phone contract once more, but most importantly it shows stability to other potential lenders via a recorded credit history of on time payments. It also shows my bank (Nationwide) that I am using credit responsibly via direct debits on my account, Nationwide review the foundation account every 6 months to see if an upgrade is appropriate.
I will of course be far more careful with credit after bankruptcy, I will plan each application accordingly, but for those struggling with starting off the rebuild process it looks like a great option. I plan to use a sky high interest credit card in a few months, adding more positive history for my eventual mortgage application. Small responsible steps to getting on the ladder.
Side note: If you do this and go for the lowest priced option on a 12 month contract (I suggest you do), call Vodafone once the order is dispatched/arrives and say you found a better deal with EE/Three etc, they will go above and beyond to add more to the tariff. Remembering that you can upgrade in 3 months should you wish, not tied to Vodafone directly, a third party such as CPW or other outlet could offer a better value upgrade.
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Comments
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Very positive post. Truce?0
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Absolutely, nice to have you back.0
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Thank you. My saving grace on this subject is that I maintained my EE contract. Green ticks for 9 months, the OR did grumble at £60 per month though - think the fact I use the number for self employed business that they could take excess from (none thus far) swayed her.0
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My EE contract floats around the 100 a month mark (it includes an ipad), per my previous post the OR didn't bat an eyelid, in fact we didn't even discuss my monthly outgoings as it 'wasn't necessary because I wasn't working'
Can't work out whether I've had a major result here or I'm going to be hauled back in to do it all again (the examiner who did me was a last min replacement as the initial guy called in sick)0 -
Sounds like its not the OR saying that expense is fine, more that as your income is all from an exempt source there's no point in going over expenses.
You might find that if circumstances change the expenditure is looked at again and you may not get an allowance for the full amount(although you may be able to cover it from other areas of budget, which you can economize on)0 -
It enables me to run a mobile phone contract once more, but most importantly it shows stability to other potential lenders via a recorded credit history of on time payments. It also shows my bank (Nationwide) that I am using credit responsibly via direct debits on my account, Nationwide review the foundation account every 6 months to see if an upgrade is appropriate.
Just to warn \set expectations, I'm almost 3 years post a short (full and final) IVA. I've yet to be offered a upgrade at Nationwide(in spite of positive history from credit cards and a mobile contract). Obviously I hope they will upgrade me at some point, but I'm not holding my breath(to be honest the account is pretty good as is)0 -
Just to warn \set expectations, I'm almost 3 years post a short (full and final) IVA. I've yet to be offered a upgrade at Nationwide(in spite of positive history from credit cards and a mobile contract). Obviously I hope they will upgrade me at some point, but I'm not holding my breath(to be honest the account is pretty good as is)
Rightly so, and thank you.
I fully expect an account upgrade to take longer than a mortgage offer will, it's just the crazy way in which the system operates. I guess a never insolvent equivalent example is that of an applicant being granted a mortgage but denied a credit card. I outlined the 6 monthly review for the benefit of those flexbasic nationwide account holders; making an application for a full account, pointless when reviews are already in play.0 -
The Vodafone contract idea is very good. I applied straight for something like £20 a month and got rejected, I've got tonnes of searches though. If I ever get booted off my Three One Plan or whatever it's called, I'll certainly try Voda @ £9.50!
.... allegedly.[snip] when reviews are already in play.
Has anyone actually had an upgrade? It's now 11 months since the account launched.
They told me to clear off, despite £2k a month salary going in to the account, direct debits etc with no issues and a maxed out help to buy ISA with them.
Put a complaint in, and still got told to clear off, and that they (allegedly) review accounts after 6 months and then periodically after.
My credit is far from the best (bankrupt 2 years ago) BUT I've got £1,000 with Cap1, and another £1,500 with Cap1 recently, which I'm managing fine. If they won't give me an upgrade, I find it hard to believe many people will get an upgrade any time soon!!
Also - what does it say when you click Upgrade on online banking? It appears you can force an internal check for an upgrade that way.0 -
Somerset_La_La_La wrote: »The Vodafone contract idea is very good. I applied straight for something like £20 a month and got rejected, I've got tonnes of searches though. If I ever get booted off my Three One Plan or whatever it's called, I'll certainly try Voda @ £9.50!
.... allegedly.
Has anyone actually had an upgrade? It's now 11 months since the account launched.
They told me to clear off, despite £2k a month salary going in to the account, direct debits etc with no issues and a maxed out help to buy ISA with them.
Put a complaint in, and still got told to clear off, and that they (allegedly) review accounts after 6 months and then periodically after.
My credit is far from the best (bankrupt 2 years ago) BUT I've got £1,000 with Cap1, and another £1,500 with Cap1 recently, which I'm managing fine. If they won't give me an upgrade, I find it hard to believe many people will get an upgrade any time soon!!
Also - what does it say when you click Upgrade on online banking? It appears you can force an internal check for an upgrade that way.
The check really does happen every 6 months. I like yourself have been through the complaints procedure due to the ability to upgrade to flexdirect being offered whilst insolvent, odd yes, tempting, certainly. Turned out to be impossible.
The advice I was given by their back office application team, via complaints, was that my account was marked as 'financial hardship' a physical marker, much like bankruptcy is kept on file. When the system performs a review it is stopped by the marker.
I had the marker removed by nationwide after discharge, it was not an automatic process. Might be worth doing the same?
I whole heatedly agree about the account upgrade taking multi years, I of course hope one day to gain current account status once more, but my ultimate aim is a mortgage and strangely, a current account is not required :rotfl:
Sorry to hijack my own thread here (is that possible?) have you looked at a LISA? I'm going to plough my help to buy ISA into the lifetime when it launches, you can do this penalty free but of course suffer the 25% rule should you ever need the funds for anything other than house purchase, anyway, just thought I'd mention it but I'm sure you're ahead of me.
P.S:
If you have the spare and can afford the loss for 4 months then this is well worth a read:
http://www.hotukdeals.com/deals/shepherds-friendly-stocks-shares-isa-cashback-100-250-available-for-very-little-2417466
Free money.0 -
Very interesting - it sounds like the Lloyds CPD process then!
I've been discharged the entire period I've had the account, but closed it after disagreements with their complaints team over reporting it as a basic account.
Now they've (finally) resolved my complaint, I've opened another one.... in 6 months I'll look at getting a financial hardship marker removed (they were a creditor of mine years ago so if you had one I certainly will!)
Haha Hijacking your own thread! LISA looks interesting when it's launched - that deal looks great for a normal one, but I've opened H2B and a normal ISA this year (then closed it), not sure I can legally open another until April. Will look then though - as people in the thread are saying, fairly low risk investments can be chosen, and presumably once it's paid you can transfer elsewhere/turn it into a LISA.
You can't buy in the first year of opening a LISA, but I can't buy til Oct 18 anyway (3 years discharged), so bagging the cashback from Apr 6th shouldn't set me back0
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