If I am reading the FAQ here properly: https://www.apple.com/shop/apple-upgrade.
> If you decide to buy the device, the purchase option fee is the list price minus any lease payments you’ve made minus any remaining discounts or trade-in credit. (excluding tax and any damage fees).
Lets look at a couple examples:
iPhone 17 pro max would be $1199 to buy (~1273 with tax) or $34.99 for 24 months totaling $839.76. So would cost 433.33 at the end of the lease to keep it
The cheapest 16" MBP would be 2,999 to buy (3186.44 with tax) or $57.99 for 36 months (or 80.99 for 24 months). 2087.64 or 1943.76. So around ~1k to buy it at the end.
It looks like you can keep making payments for 6 months to lower the buyout price a little bit.
So worst case scenario this is a 3 and a half year interest free loan with a higher payment at the end.
Seems not terrible? As long as you treat it as a loan and not a lease you can end at any point it seems fine and nothing really shady about it. You still have the option to own the device for the original cost.
Other than the loss of the iPhone upgrade program and the yearly upgrades, am I missing something here? I guess the biggest thing is you likely can't just pay it off and be done with it if you had the money.
A lot of people aren’t going to have that $433 at the end of the lease to purchase the device outright, and so will have to roll it into another 2-year monthly payment, and another one after that.
So the goal of the program is the same as every other similar one - they want to turn a one-time device purchase into a perpetual monthly revenue stream, while keeping ownership of the asset at the end.
I think you're looking at this too much from the perspective of someone who wants to own the phone, not as someone who wants to consider a lease.
Leases are not a new invention. A lot of people, including very financially savvy and well off people, choose to lease rather than buy depending on the circumstances.
It preserves optionality. If you get to the end of the lease period and there’s a new iPhone you want or the battery isn’t holding up, you can choose not to buy it. You don’t have to deal with selling it or trading in.
If someone doesn’t have $400 to buy out the residual then I doubt they would have had the cash to pay for the whole thing up front. I don’t understand what your argument is.
> So the goal of the program is the same as every other similar one - they want to turn a one-time device purchase into a perpetual monthly revenue stream, while keeping ownership of the asset at the end.
It’s an option. They’re not turning anything into anything. Anyone who wants to buy the device can buy it. You now also have the option to lease it for 12 or 24 months and then after that you can still buy it if you want. Or you can not buy it.
It’s options. You don’t have to use it.
But they're not actually interest in owning 2 year old phones though right?
They're just interest in you / 2ndary market not owning any?
If someone can’t plan ahead 2 years for a $433 expense, they definitely should not have a top of the line iPhone. When my income was low I had an iPhone SE that cost $329.
You literally don’t own the hardware, it’s a lease.
That said, you can purchase with financing with an Apple Card, or with numerous other financing options like carrier financing. However, leasing allows the purchase prices of phones to continue climbing while still presenting a palatable monthly payment.
I think what’s going to happen with this is a lot of people will be lured in with low payments and then be surprised with the ending “keep your phone” payment, where it will feel like it makes more sense to just get the new phone and continue the same payments.
Paying a $400 payment on a 2 year iPhone will look insane as that’s the depreciated value of a 2 year old phone.
Is a 3 year upgrade cycle for a MacBook Pro unreasonable? Would you get a lower spec machine since you were not trying to maximize the life of the machine? I know I always tend to overspec my machine to keep it for as long as possible.
My M3 MBP with 36GB of ram (looks like it was about 2500 3 years ago) would get me $945 in trade in credit. May be able to get more on eBay but I can't argue with just doing trade in is easier. A bit less than I would "save" by just upgrading at the end of the lease and this already is not the base model so the number does shift.
Especially when I look at the payment options right now I could finance that MBP about $250 on my Apple Card for 12 months no interest, or $57.99 for 36 months. and then I get a new one.
Would probably depend on what it is I was doing with the machine, am I doing tasks that would actually benefit from better and better machines like video editing and similar tasks or am I just using my computer fairly basic in a way that even an M1 machine still handles just fine.
In any case, doesn't this sound like an insane contract for Klarna to have signed? It's freaking Apple. Mind blowing deal for a buy-now-pay-later company to sign. Imagine being in the chain for an Apple product. What a coup.
Instead of automatically owning the device after making all payments, you can choose return/upgrade/buy it at the end of the lease. The new program is backed by Klarna instead of Citizens Bank, uses a soft credit check, and no longer includes AppleCare+ by default.
The fact that the page is not particularly clear about any of this should tell you everything you need to know about this change.
I know a lot of people use postpaid, but I can't understand why. I'd challenge anyone to justify that decision, given that the phone "deals" are rarely even much of a subsidy as opposed to a financing scheme that acts as a contract, and the plans cost about triple what I pay every month, for fewer features and equivalent at best priority and speeds.
[1] https://9to5mac.com/2023/06/15/apple-card-financing-sim-free...
I had a friend who bought a new Mac every year, selling his old Mac. His calculation was that it was about the same price as keeping one Mac and upgrading every 5 years.
I'd consider leasing a Mac through this program. I priced one out, with the options I chose it's $8149, lease for $177 (6372 for 3yrs, 8496 for 4yrs).
Yes, at the end of those 3 years I don't have a mac, I have to keep paying, but I'd prefer a new Mac every 3yrs and it's just easier than trying to sell it for $1777. It doesn't seem like a bad deal to me, plenty of people lease cars. Plus, if you consider you can keep your moneny in interest earning account, then at 3% you'd end up with $2256
I'm not saying that makes it a good deal for you, but I personally like the idea of not paying out $8149 day one, especially for something I know has a shelf life. I'm on an 2021 M1 Mac. It works great. But I've also tried to run 70b LLMs and run out of memory (64g), so I think about upgrading to 128g which, being Apple, I can only do by buying a new mac.
Companies that require frequent hardware refreshes would benefit from this, though Apple already had has programs for those.
It’s not just a 1 year program.
The comment you replied to had numbers for the 4 year option.
They’re discontinuing this and replacing it with Apple Upgrade, which is structured as a lease. Apple owns the device and you make payments. You either return the device or buy it out at the end.
The distinction probably doesn’t matter much to the typical consumer, other than the final price differences. Some people have an emotional attachment to knowing they own the phone instead of leasing it (I’m emotionally attached to this position, however illogical) but in the end it comes down to having a device in your hand for a monthly payment.
Even if you are upgrading every single year, it works out roughly the same to just buy every phone outright and then trade in last year's model -- you typically get ~half your purchase price back as trade-in value after a year anyway.
https://www.apple.com/shop/apple-upgrade
It looks like this leasing program is just moving into a more generic/Apple-wide offering... not sure if the fine print changes.
[edit: from the comments, it sounds like the difference is it was previously 0% interest financing and no longer is]
Now it's just a normal lease product with a 0% money factor through Klarna, that also works across Apple.
What this does is gives Apple more "price flexibility" (aka, they can raise prices more easily, which was probably a lot of the driver for this), but also gives consumers more buying power flexibility since it's a simple product that works across the board rather than a bizarre iPhone specific optimized financial instrument.
My MacBook Pro was over $6,000 refurbished, and this was before Apple raised prices.
[1] https://www.ifixit.com/News/94386/the-truth-about-apples-fre...
Unless you are happy with Apple or Google literally owning your phone and everything in it, the solution is to buy a Pixel, with cash, unlock the bootloader, and flash GrapheneOS.
https://9to5mac.com/2026/07/21/ios-27-code-suggests-apple-co...
It will be curious to see if the first Klarna defaults will start triggering a future Restricted Mode on the phone and the parts get blacklisted from re-use.
I assume certain apps will get an entitlement from Apple to enable/disable this on the device.
edit: confirmed they aren't... yet.
https://www.theverge.com/tech/972063/apple-upgrade-program-n...
Why would I tie up $1,200 upfront in a device that’s going to be obsolete in a couple of years when I can spread the cost over time, preserve cash flow, and (if it’s a legitimate business expense) deduct the lease payments?
Keeping $1,200 in my business earning a return is often worth more than prepaying for a depreciating asset.
People happily lease $80,000 vehicles for exactly these reasons. Applying the same logic to a $1,200 phone isn’t irrational, just the same financing decision at a much smaller scale.
There's no interest, no fees. The total lease price (if you buy out at the end) is the same as the retail price. There's no downside to it at all.
If you are someone who upgrades annually, you're now paying ~$599 split over 12 payments vs. ~$1199 up front and either trading in or trying to sell your last gen privately. It works out to about even on a trade-in->upgrade every year cycle, only you don't have to fork over the $600 up front.
Pay $32/mo (so $770 total) to use an iPhone for two years and then give it back to Apple.
This is truly the most dystopian timeline.
At the end of your device lease term, you have an option to buy out your leased device. With the buy out cost being equal to the device sticker price minus the amount you had already paid on your lease.
This seems pretty fair to me tbh.
Why? Leasing has always been an option that some people and businesses prefer, depending on the circumstances. It’s commonly done with cars. In business situations leasing can be very common because it works well with your cash flow and doesn’t require taking more debt on your books.
You can buy out the item at the end of the lease term. Some people like this optionality because they get to defer the purchase decision into the future and benefit from any new information, like whether or not a new iPhone is worth upgrading to or how the battery is holding up.
> While our customers have loved the iPhone Upgrade Program, we’re always looking for ways to give them more flexibility, better value, and a more seamless experience.
If I were malicious dictator for life, there would be a special section in my gulags for the people who write copy that entails telling customers it's raining while pissing on them.
On the one hand that gives users an option.
On the other hand, that is a way to hide a price increase. Also, those doing this are almost obliged to take AppleCare, as (https://www.apple.com/shop/apple-upgrade):
“What do I do if my device gets lost or is stolen?
If you have AppleCare+ Theft and Loss for your iPhone, iPad, or Apple Watch, you can file a claim at mysupport.apple.com/theftandloss.
If you don't have AppleCare+ Theft and Loss coverage and your device is stolen or lost, you'll need to close out your lease by paying the early termination fee or choose to pay the purchase option fee (plus any applicable taxes and fees). You can do that at an Apple Store, or through the Klarna app. You can then start a new lease with Apple Upgrade, finance with Apple, or buy your next device with a one-time payment.
You will continue to be charged your monthly lease payments until you either pay the early termination fee or purchase option fee. If you take no action, Klarna will continue to charge you your monthly lease payment through the extension period, and you will be charged the purchase option fee through Klarna.”
Looks like a recession indicator to me.
You'll own nothing and you'll feel weird about it.
I subscribe to /r/NoContract/ so I have a pretty good idea what's out there.
Visible+ is a comparable pre-paid plan, it's $29/mo but that's a teaser rate and to keep it past one year, you'd have to port out and port back in for whatever deal they have in one year. The normal price is $35/mo, so I'm beating that. (Visible would also mean managing 4 separate accounts since they have no multi-line plans.)
Total Wireless is a bit cheaper ($26/mo) but I keep reading terrifying customer service issues with them including most recently losing number during the porting process.
Aside, I briefly used US Mobile earlier this year to port a VoIP line to Google Voice (GV will only port-in mobile numbers). US Mobile's customer service is exceptional. Would recommend them heartily for pre-paid service. But they don't currently beat what I'm getting from Verizon post-paid. I'd consider them if I can't keep my loyalty discounts next year.
Another thing to note about Visible+ is that if you have an Apple Watch with cellular and want to use that with your plan there is absolutely no reason to consider Visible+.
Watch support can be added for $10/mo but that brings the total to the same as their highest level plan, Visible+ Pro, which includes watch support. That plan is $45/mo $450/year ($37.50/mo) and promotional discounts run out.
As far as I was able to tell, Visible+ Pro is the best or very close to the best deal for people who want Apple Watch support in the US and only want one line. You can get lower prices per line on postpaid plans with multiple lines but if you will only have one the postpaid plans are ridiculous (even before you add in watch support).
I check with people that come around or in random stores if they can beat it, alas they cannot.
It is hard to get eSIM to work, but they have good customer service (but you need accses to a phone to call them, so you should try something like textnow or Google Voice) which helped my friend set it up.
It is not a intruductory offers, AFIK.
Two reasons: data caps and device cost.
People want iPhones but they cost $1000 outright which isn't a small amount of cash these days so they roll the cost of the device into their monthly bill. The average consumer also doesn't understand how mobile data versus 802.11 works - their kid doesn't activate Wi-Fi on their phone or download anything, they see a large number with "GB" on the end, and they pay whatever is necessary to keep the Instagram scrolling and Disney+ flowing.
Buying an iPhone outright, flipping the old one every few years (they hold their value well) and using a $30 a month 10GB plan is doable if you have money and are savvy enough to download podcasts and use your home's AP for data.
Carriers certainly aren't incentivized to educate consumers better since they'd rather make money on device installments and milk them for hundreds of dollars a month because they "have a large family and need a lot of data". Home broadband marketing is even worse - why a family of four "needs" 500 Mbps down is absolutely beyond me. In an ideal society consumer literacy would be taught in school but I'm not holding my breath.
> Financing available to qualified customers, subject to credit approval and credit limit, and requires you to select Citizens One Apple iPhone Payments or Apple Card Monthly Installments (ACMI) as your payment type at checkout at Apple. In order to buy an iPhone with ACMI, you must select one of the following carriers (but you cannot use a prepaid carrier plan): AT&T, T-Mobile, or Verizon. An iPhone purchased with ACMI is always unlocked, so you can switch carriers at any time, subject to your carrier’s terms.
The entire point of the iPhone Upgrade Program was to make it painless to swap to the newest iPhone every year. Without that, there's no value proposition.
Especially if you're someone who upgrades every year. 12 month option on a 17PM works out to ~$599 for the year vs. $1199 each year. $599 is roughly what you'd pay for each years new model assuming you trade in your previous gen each time, so at worst it's even with what an annual upgrader was paying already, at best you might make out a little better (assuming you are just doing trade-ins and not private sale).
There's no interest or fees, and you get to buy it out at the end if you want to own it, and the lease price is the same as the retail price, I see no downside.
The iUP was better about giving the choice to just buy it out at the end. This one is more rigid:
>Terminating your Apple Upgrade Lease: Closing your lease and returning your device terminates your lease. You may incur substantial fees if you terminate your lease before the end of your initial lease term. You may have the option to upgrade to a new device by entering into a new lease agreement and returning your prior device. If you upgrade, your new monthly payments may be greater than your prior monthly payments. If you do not upgrade, terminate your lease, or purchase your device by the end of the initial lease term, the lease will convert to a month-to-month lease for up to six months. Your monthly payments may increase during the month-to-month periods. If you take no action at the end of your extension period, you will be charged the purchase fee under your lease. You will not own your device at the end of your lease, unless you pay the purchase fee. Insurance is not included in your lease, and you may incur damage fees if the device is lost, stolen, or not returned in the condition required by the lease.
Partnering with Klarna explains it quite a bit. They make money on penalties. This new plan has all sorts of sticks it will beat you with if you stray off the path, so it's perfect for them.
That’s the entire point. They would have bought a cheaper phone, or held on to their old one, but are now paying perpetual monthly payments.
There’s a reason why dealerships never ask “how much can you afford”, but “how much do you want to pay every month”.
There’s a reason Klara is running the program for them.
Still, thanks for pointing it out.
They’re not putting it back into a box, listing it for sale, and pocketing the difference.
For a personal machine? Yes that’s something I see as unreasonable, MacBook Pros have a very long lifespan. M1 laptop are still pretty awesome machines. For a business an upgrade every 3 years could make sense
> Radio Rentals was the largest television rental group in the UK and claimed that at its peak it had more than two million customers, more than 500 shops, 3,600 technicians, 2,700 skilled installers and a large ancillary staff. It had sales and service locations across the UK; the Radio Rentals logo being a common sight on many High Streets.
Also calling the latest iPhone “basic consumer electronics” is out of touch. The budget options are older generation iPhones or other phones, not one of the most expensive brands on the market.