The objective of this information is to provide general education regarding the classes of service within the cell phone industry. It is also intended to aid in the determination on which class would be the best choice of cell phone service for people with bad credit.

The cell phone industry has basically two classifications of services. One is called post paid service. This is mainly the big 4 national companies everyone is familar with: Verizon, AT&T, Sprint and T-mobile. The other is called pre-paid service which is provided by names that may be familar depending on which particular part of the U.S. you live in: Cricket, Metro PC, Virgin, Boost Mobile, US Cellular, etc. Most of these companies are in some way affiliated with one of the big 4 because often it is their cell phone towers that are being used to provide the service.

The main difference to you the consumer is how the cell phone service is billed, which controls how you are treated. Post-paid cell phone service allows you to talk now and pay the bill later. This is why they require a credit check, then if approve want you to commit to a set period of time with them, and why you can carry over a balance on your bill month after month.

However… Pre-paid cell phone service requires money for the services to be paid upfront and then you can talk. Until that money runs out. Then you have to pay more money before you can talk again. Because customers must pay upfront there is no risk to the cell company. Therefore, no credit checks.

This is why pre-paid cell phone service is the best option for people with bad credit.

It’s often easier for people to understand the pre-paid cell phone model when compared to the calling cards that were so popular not too long ago. Everyone understood you purchased a $25 calling card which could be used at any payphone. Then once the card was depleted, you simply threw it away and purchased a new one. Then over time this graduated to reloadable cards. Now when the $25 was depleted you simply added more money on the card and continued on using it. Well, this is the exact same concept of prepaid cell phone service. Except no cards and no payphones. Now they are just giving you the cell phone. And now, you’re just reloading the cell phone instead of reloading a card.

However post paid cell phone service is more like a credit card. You are approved up front for a credit limit. Then they take the risk of letting you charge all kinds of things on the service. Then they collect payment from you afterwards. The risk to them is that there will always be people who don’t pay on time. There will always be people who never pay the full amount. And, there will always be people who never pay at all.

Which is why post-paid cell phone companies will always check your credit to see if you have a good payment history with other creditors. If you do the post paid companies will have no problem approving you for the service and billing you later. However.. if you don’t, they will require a large deposit. And/or set restrictions and limitations on your cell phone service. Or deny you the service all together.

By comparison the pre-paid cell phone service do not require credit checks. They do not have contracts. Therefore there are no penalties for early termination fees. And it is percisely for these reasons the pre-paid cell phone service will usually be a better choice for people with bad credit. Or, for people who just do not want contracts.

But as with all things in life… there are some important things to know about pre-paid cell phone service. Lets say for example your payment is due on the 31st, and then it is not paid by the 31st.. then you will have no cell phone service on the 1st. And, no matter how much you plead with them, the chances are very unlikely they will turn your phone back on until payment is made. And, if they feel too much time has gone by since the last payment.. you will be cancel, your phone number will be given away, and you will have to re-apply for service all over again and get a new number.

Because these situations can definitely occur most all pre-paid cell phone companies make it easy for you to keep up with your minutes, and payment due dates. They make it simple to always know exactly how many minutes you’ve use and how many minutes you have left. It all can easily seen online.. and/or you can access your account details directly from the cell phone itself.

The other big difference with prepaid cell phone service is that at the time this article was completed, no pre-paid company were offering family plans. Which means, for example, If there are 4 people in your home… that will be 4 seperate accounts… and 4 seperate monthly bills.

It is our hope that this information has been a benefit to you and helps you decide which service to choose. If you already know that you have a poor credit report. Or if you have already been declined service, by Sprint, AT&T, Verizon or T-Mobile. You can apply for prepaid cell phone service today.

BadCreditAssistance.com is a member of Consumers Info USA. We provide information, education and assistance to help people with negative credit reports obtain the financial services they need. You can get more information, and apply for prepaid cell phone service online at http://www.badcreditassistance.com/cell_phones.html