Apple Upgrade: Apple Retires iPhone Upgrade Program for Klarna-Backed Leases

[CPTmom2wp]

Not seeing comments about the fact that Klarna will send a Collection Agency after you if you miss 3 payments OR if you are unable to pay the large balloon payment left over at the end since your lease payments will not have paid the full phone amount. Please don't do this. If you can afford the payments to Klarna, then just keep your current phone and save up the same amount for a year or two until you can purchase a new or refurbished phone for cash. We all complain that the new phones don't have much of anything new or different on them anyway. Waiting a year or two really won't hurt.

 

[glxyjones]

The rest of the MSRP.

If that’s the case why not just list it on the checkout page? If it’s literally MSRP - payments already made = final buyout then it’s pretty straightforward. The fact that they don’t say that makes me think there are fees included in your monthly payments.

 

[Ethrem]

If that’s the case why not just list it on the checkout page? If it’s literally MSRP - payments already made = final buyout then it’s pretty straightforward. The fact that they don’t say that makes me think there are fees included in your monthly payments.

Will I pay more than the full price of the device?​

No. If you decide to upgrade or return your device at the end of your lease term, the total of your lease payments you made will be less than the full list price of the device at lease signing (excluding tax and any damage fees). 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).

Are there any fees included in the monthly cost for the program?​

There are no fees associated with your monthly lease payment, but you will need to keep your device in good condition, or purchase AppleCare protection to avoid a damage fee at the end of your lease term. Additionally, there may be fees associated with upgrading early or terminating before your initial lease term is over.

Apple Upgrade - Lease iPhone, Mac, iPad, Watch

Introducing Apple Upgrade, a new way to always have the Apple products you love. Lease a new iPhone, iPad, Mac, or Apple Watch with low monthly payments.

www.apple.com

As long as you don't damage the device, you will never pay more than the MSRP + taxes. If you aren't upgrading, you don't have to worry about the damage fees.

 

[markredf150]

Apple today launched Apple Upgrade, a new U.S. leasing program for iPhone, iPad, Mac, and Apple Watch. Apple partnered with Klarna for Apple Upgrade, and it replaces the current iPhone Upgrade Program and iPhone Payments.

Apple Upgrade has lower base prices than the iPhone Upgrade Program, with iPhones available starting at $17.99 per month and the Apple Watch available starting at $11.99 per month. Macs can be leased starting at $24.99 per month, and iPads start at $11.99 per month. AppleCare+ is optional and not included in the lease price, with customers also able to opt for AppleCare One.

There are 12-month and 24-month leasing options for the iPhone and Apple Watch, along with 24-month and 36-month leasing options for the Mac and iPad. Lease cost varies based on device, and is lower with a device trade-in that's applied on a monthly basis. Apple has some sample pricing, minus taxes and trade-in credits:

• 256GB iPhone 17 Pro ($1,099) - Typical monthly payment is $31.99 with a 24-month lease or $45.99 with a 12-month lease.
  
• 42mm Apple Watch Series 11 ($399) - Typical monthly payment for a 24-month lease term is $11.99 per month, or $21.99 for a 12-month lease term.
  
• 256GB iPad Pro ($1,199) - Typical monthly payment is $24.99 for a 36-month lease term, or $31.99 for a 24-month lease term.
  
• 16GB 14-inch MacBook Pro ($1,999) - Typical monthly payment is $38.99 for a 36-month lease, and $53.99 for a 24-month lease.

When leasing an iPhone, customers are required to choose a plan from AT&T, Verizon, or T-Mobile, and prepaid plans are not eligible. iPhones need to be leased with a carrier plan, but the iPhones are unlocked so customers can switch carriers if desired. MVNOs like Mint Mobile or Visible are not supported.

At the end of the leasing period, customers can choose to return the device and exit the program, pay off the remaining amount owed on the device with a one-time payment and keep it, or return it and upgrade to a new device with a new lease.

The payoff amount is the difference between what was paid during the leasing period and the retail price of the device, minus any remaining trade-in credits. Klarna is not charging a fee for the leasing program, so an iPhone that's $1,099 can be leased and then purchased for $1,099 with no extra cost beyond taxes.

As with trade-ins, Apple will send a pre-labeled and prepaid shipping box for device returns or upgrades.

If you don't opt to pay the purchase fee at the end of the leasing program, you will not own the device and must return it.

Apple is discontinuing the iPhone Upgrade Program, and iPhones can no longer be purchased with it. Current participants can continue to make payments until their existing iPhones are paid off, but at the next purchase, they will need to switch over to Apple Upgrade or another payment option. Apple Card users can continue to buy devices with the Apple Card Monthly Installments plan or choose Apple Upgrade and get 3% Daily Cash back on lease payments made with Apple Card.

Apple Upgrade is available for online and in-store purchases. Customers can select their preferred leasing option, and after a soft credit check, get an instant approval from Klarna if eligible. Lease information like billing schedule, total price, and remaining payments can be managed in the Klarna app.

Most iPhones, iPads, Macs, and Apple Watch models are eligible for Apple Upgrade, but the program can't be used for iPhone 16, iPhone 16 Plus, Apple Watch SE, MacBook Neo, Mac mini, iPad (A16), and Studio Display purchases. Apple Upgrade cannot be used with EDU discounts, and leases aren't available for refurbished devices. Apple also excludes purchases made with the Apple Employee Purchase Plan and business, government, veteran, and military purchase programs.

Fine Print

Lease participants can opt to end a lease early and return a device, but Apple says there may be "substantial fees" for terminating a lease before the end of the term. The fee is the remaining amount of the lease, so terminating a lease three months early means paying the remaining three months. There is no fee for paying off a lease early.

Customers must upgrade, end the lease, or purchase the device at the end of the lease term. If that doesn't happen, the lease converts to a month-to-month lease for up to six months. Month-to-month payments will remain the same, but if there was a trade-in credit being applied monthly, it ends when the lease does, so payments could go up. At the end of the month-to-month lease add-on, customers will be charged the purchase fee.

Damage to an iPhone, losing an iPhone, or having an iPhone stolen could incur fees. Klarna assesses damage at return and charges accordingly. With AppleCare+, the cost is the applicable service fee, but without it, the full cost of the assessed damage has to be paid.

If a customer misses a payment, the payment is rolled into the next month's payment, but there are no late fees incurred. If there are three consecutive missed payments, the lease agreement ends and the customer has to pay the full outstanding balance minus the value of the device when returned. If Klarna is unable to collect payment, the case will be handed over to Klarna's debt collection agencies. Apple says Klarna support offers a one-month payment deferral and an early lease termination option with a repayment plan.

Leases are restricted to customers who are 18 or older (or legal age in their resident state) with a valid SSN or ITIN. Customers must be U.S. residents, and territories are excluded. An Apple Account in good standing is required, as is a Klarna account and a credit or debit card.

Availability

Apple devices can be leased with Apple Upgrade in stores or online starting today.

Article Link: Apple Retires iPhone Upgrade Program for Klarna-Backed Leases

Does everyone understand what this means? I believe the message here is "get ready", most likely the next generation iPhones are bumping up in price, but Apple is laying down the foundation for people to be able to afford the upcoming folding phone. This leasing program could take some of the sting off of that likely $2,000+ price point, but if it's a 2 year lease, you're still dishing out about $100 a month!

 

[Ethrem]

Does everyone understand what this means? I believe the message here is "get ready", most likely the next generation iPhones are bumping up in price, but Apple is laying down the foundation for people to be able to afford the upcoming folding phone. This leasing program could take some of the sting off of that likely $2,000+ price point, but if it's a 2 year lease, you're still dishing out about $100 a month!

Yeah I think it's going to be a hard sale. Even Verizon added 48 month financing when they launched their Simplicity plan that doesn't include device subsidies because they know that $2500 split over 36 months is $70 a month while 48 months drops it to $52.

On a 24 month lease, assuming the same ~70% paid off through the lease term, the payment would be $73 a month

 

[Dnola]

You're ignoring the value of the equipment at the end of the lease. It would unquestionably be higher that any interest received by not paying outright.

 

[webkit]

You're ignoring the value of the equipment at the end of the lease. It would unquestionably be higher that any interest received by not paying outright.

The value of the equipment isn't being "ignored" as it is reflected in the lower monthly lease payment. For example, a 12 month lease on a 256GB iPhone 17 is $32.99/month or $395.88 for the year. The difference between full retail ($829) and lease payments ($395.88 for year) is $433.12. The $433.12 is value at lease end.

 

[Steve Adams]

This isn’t any different than whats been happenning in Canada the last few years. Telecom companies have a “bring your device” back program. Essentially a lease with an option to purchase it at the end.

Bring your own device is just that, sign up for a month to month plan, no contracts without a phone. What you are talking about is device return option. I work for a telco in Canada, you are confusing two different products.

 

[theorist9]

I suspect this means that, starting about two years from now, we'll be seeing a much greater selection of products on Apple's refurb store as consumers turn in their leased devices.

 

[SoCalGadgetGuy]

👉🏻 Is there a similar program for European customers?