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

[DEMinSoCAL]

I may be mistaken, I’ll check that out. Thanks for replying instead of just hitting disagree.

LOL! I literally told you the same thing back on post #27 from you.

 

[slippery-pete]

Are you not understanding? You ALWAYS pay your phone off by handing over the old device and paying off the second year. Nothing has changed except the including of Apple Care + not being required which is not smart. It’s going to cause a big mess for them.

Huh? I am on IUP and after 12 months I just sent my phone back...never "paid off" year two.

My understanding of the new program is this: come September, I'll be able to send my IUP phone back (owe nothing since I will have made the 12th payment) and choose a phone on the new program with a 12 month term. Come the following September, do it all over again.

 

[Ffmedic130]

My question is I use Mint Mobile as a secondary line, but I have AT&T as a primary line will I be able to add mobile as a secondary since my primary will be through a carrier that’s approved and the phone is “unlocked”

 

[hovscorpion12]

Huh? I am on IUP and after 12 months I just sent my phone back...never "paid off" year two.

My understanding of the new program is this, come September, I'll be able to send my IUP phone back (owe nothing since I will have made the 12th payment) and choose a phone on the new program with a 12 month term. Come the following September, do it all over again.

If you select the 12-months term through Klarna, it would be “identical” to the previous iUP. If you select the 24-month, I don’t believe you have the option to update in 12.

 

[mannyvel]

For macs this is a good deal. I usually expense the Mac outright and buy refurb, but leasing a mbp 16" 48/1tb comes out to 1k less over 36 months.

 

[hovscorpion12]

My question is I use Mint Mobile as a secondary line, but I have AT&T as a primary line will I be able to add mobile as a secondary since my primary will be through a carrier that’s approved and the phone is “unlocked”

If Mint Mobile is added as second eSIM I believe so, yes.

So long as the “main” line is through any of the big three.

 

[slippery-pete]

If you select the 12-months term through Klarna, it would be “identical” to the previous iUP. If you select the 24-month, I don’t believe you have the option to update in 12.

Yes, that is my understanding as well. To upgrade every year, you'll have to select the 12 month term.

 

[hovscorpion12]

For macs this is a good deal. I usually expense the Mac outright and buy refurb, but leasing a mbp 16" 48/1tb comes out to 1k less over 36 months.

A full spec Mac Studio M3U 96GB 1TB for $141

 

[jlc1978]

You seem to be contradicting yourself. Most leases do have a baked-in fee each payment, and that is the profit. So the total cost (down payment + total of payments) is MORE than the actual cost of the item. This plan, as has been clearly stated over and over, whether you pay upfront or over time, the net cost is the same.

Not really a contradiction, Im saying exactly what you are saying. Most leases have an imputed interest rate baked in, they are essentially a loan with a balloon payment. I said Apple's is different from most leases.

Apple's appears to not charge more than the retail price, and spreads that over the lease duration with a fixed residual value that determines the actual amount paid each month.

I don’t think you can reasonably expect anyone who isn’t in the real estate business to buy houses for cash though.

Cash buyers near us cn also be someone who is downsizing and is taking the proceeds from a sale of a paid off or nearly paid off house to buy a new one all cash; or moved form a much higher property value location. I agree, however, that's a small part of the all cash buyers who tend to be corporate buyers now looking to rent houses in desirable locations.

 

[mathiasinthe314]

If I am reading this right, I'm not going to be able to trade in my current device on IUP this year and get a new iPhone, without paying mine off or opening a completely separate lease (making two payments for two devices). That feels like a rug out from under me.

After reviewing Apple's IUP site, I will still be able to upgrade after 12 payments, trading in will close my loan and I can transfer over to the new program.

 

[PBG4 Dude]

Yep. This is a dumba** move by Apple and certainly seems like collusion with the big 3 carrier. Why the hell would Apple even force customers into this position? I use Mint and am not going to play this game where I select a big 3 carrier, then drop it, and then move to Mint. Too much trouble.

I’m wondering if Apple is doing this because the phone companies perform their own credit checks before offering post-paid accounts and this works like a secondary credit worthiness check?

 

[jlc1978]

I’m just saying why finance something for twelve bucks a month and then make one big payment of over $100. In that case may as well return it.

Maybe there’s a good reason for people to do this in some cases.

Someone starting a small business may not generate enough revenue to write off a large computer purchase and a lease preserves some of the write off into future years. More importantly, it frees up available cash for other uses, such as rent and food while you build a business.

 

[slippery-pete]

After reviewing Apple's IUP site, I will still be able to upgrade after 12 payments, trading in will close my loan and I can transfer over to the new program.

Perfect. I thought I understood it that way, but some posts on this board got me wondering.

 

[maclaw21]

This couldn’t be further from the truth. An electronic device is a depreciating asset. Leasing a depreciating asset while you keep your money invested or making interest is smart financially. And especially when you can lease for 0% interest….. why would I take $1200 out of an account making returns to pay for a phone up front, when I can keep most of that money working for me and lease the phone for 0%.

This is not a bad thought, but I suspect most people will blow the money saved and not invest it as you suggest.

 

[zilchfox]

Apple owns the iPhone, not Klarna. Klarna's just the financial institution handling the payments.

It's possible Klarna is making money behind the scenes from Apple, but there is no additional cost (i.e. interest) from the customer to Klarna.

Incorrect. Klarna owns the iPhone once started the lease.

 

[Spinarelo]

Yeah.... except 99% of people will never do what you just said. They are financing their door dash. That's the average schlep. 2/3 of Americans are living paycheck to paycheck both rich and poor. People just suck with money, period.

Fair point. Most people will probably see this as an opportunity to buy other frivolous stuff with any money saved, instead of looking at it as an opportunity to put that money to work.

 

[mistymac]

That cannot be true. It has to be a mistake. I was told repeatedly that there would be interest since Klarna "is in the business to profit off customers" and that they're "a money making operation".

Are you telling me they were wrong?

Hehehe they forgot about the weight Apple pulls and why it was in Klarna's interest to hook up with them and offer consumers a good deal. This will make many people trust and use Klarna regardless of whether or not they should lol. I'm very glad Apple pulled a good deal for its customers with this. Helps those who need help, makes sense for us frequent upgraders, and can technically be a financially wise choice if you invest money or utilize high yield savings accounts.

 

[Grayburn]

After reviewing Apple's IUP site, I will still be able to upgrade after 12 payments, trading in will close my loan and I can transfer over to the new program.

Huh? I am on IUP and after 12 months I just sent my phone back...never "paid off" year two.

My understanding of the new program is this: come September, I'll be able to send my IUP phone back (owe nothing since I will have made the 12th payment) and choose a phone on the new program with a 12 month term. Come the following September, do it all over again.

Yep, that's what I've been doing for years with Apple.

 

[Cayden]

Might be the end of yearly upgrades for me. I’ve been on the iUP since the 7 came out, got the new phone every year since the 5S. Just been slowly getting less and less exciting. I currently pay $61 a month for a 17 Pro Max 256 GB with AppleCare. This same thing would be $64 through Apple Upgrade, and I’m sure it’ll be even more when they raise prices on the 18.

 

[izyreal]

I consider Klarna an unethical company that is intentionally doing its best to trap people in debt. No thank you.
I'm disappointed with Apple's choice here.

 

[HylianKnight]

Yeah except when I financed my truck I wasn’t then locked into driving on only certain roads.
If I’m financing a phone at a rate that high, I want access to ANY network I choose especially if I’m traveling abroad.

The phone is unlocked, so it stands to reason that using another carrier while traveling abroad is a nonissue

 

[HylianKnight]

I consider Klarna an unethical company that is intentionally doing its best to trap people in debt. No thank you.
I'm disappointed with Apple's choice here.

I agree with this. I have a very low opinion of Klarna

 

[jbachandouris]

Might be the end of yearly upgrades for me. I’ve been on the iUP since the 7 came out, got the new phone every year since the 5S. Just been slowly getting less and less exciting. I currently pay $61 a month for a 17 Pro Max 256 GB with AppleCare. This same thing would be $64 through Apple Upgrade, and I’m sure it’ll be even more when they raise prices on the 18.

Since no official pricing has been announced your argument holds little weight. I’m paying the same and I just assumed at least $3 more already.

 

[HylianKnight]

Since no official pricing has been announced your argument holds little weight. I’m paying the same and I just assumed at least $3 more already.

I think in many ways, this plan is similar enough to the iUP for most. That said, there are some significant differences that should be clearly explained to people. The aspect I’m trying to determine is how best to add AppleCare+ moving forward

 

[canadianreader]

And this probably will soften the blow a bit if new iPhones go up in price this fall.

This is it. If you can't own it rent it.