Verizon iPhone trade in

[bcemail]

I saw Verizon is offering$650 if you trade in an iPhone 6, spread out over 24 monthly payments. Has anyone done this offer? I was surprised they were offering this. Am I missing something? What's the catch?

 

[aajeevlin]

You have to stay with Verizon in "contract". Other then that nothing else. I gave them my phone and they gave me a receipt with $650 credit for the next 24 months.

 

[44267547]

I looked into it and I decided to sell my iPhone outright for the profit. I opted for the monthly payment on my new 7 Plus, which when you have made 12 monthly payments, Verizon will pay off the remaining balance owed, allowing the customer to upgrade to the newest device every year for the next preorder. Which, I always enjoy the latest and greatest.

My question would be, what does Verizon do with these phones? Clearly they are making a profit somehow.

 

[bluespark]

I saw Verizon is offering$650 if you trade in an iPhone 6, spread out over 24 monthly payments. Has anyone done this offer? I was surprised they were offering this. Am I missing something? What's the catch?

The catch is that the payment is spread over 24 months. This is good for Verizon in multiple ways: First, it means that users must stay with Verizon for two years if they want the full payout. In that scenario, Verizon gets the advantages of having you under contract even if you aren't. Second, they often will have to pay only half that much. If you take that deal but want to upgrade next year, Verizon will let you do that by paying off your phone in full, but without benefit of the future monthly discounts. In that scenario, upgraders only see half of the benefit. Third, Verizon benefits from the time value of money since they can immediately invest whatever they receive for your phone while paying you for it over time on an interest-free basis.

That's not to say it isn't a good deal, as you may get more for your phone that way than you would otherwise, and you may not have been planning to switch providers anyway. But you should make sure you are comfortable with the terms before taking the deal.