You need a new iPhone and Apple wants to help you finance it
There’s a new way to finance an iPhone in town and it’s called iPhone Payments.
With the launch of the iPhone 11 and iPhone 11 Pro, Apple has added another way you can finance your purchase, making it even easier for many people to get the phone they want at a price they can afford right from Apple. It’s called Apple iPhone Payments and it’s different from the iPhone Upgrade program in one major way: you’re not trading in your iPhone to upgrade next year. Here’s everything you need to know!
How is Apple iPhone Payments different from the iPhone Upgrade Program?
On the surface, it may seem like the iPhone Upgrade Program and the iPhone Payments plan are the same, but they’re not. They are entirely different finance programs with different features and restrictions.
The iPhone Upgrade program allows you to begin a sort-of leasing program with Apple, wherein you can trade in your current iPhone and upgrade to a new one in as early as six months with fees, or one year without additional fees. If, after two years, you want to upgrade, you can, but you don’t have to trade in the iPhone you’ve been using on the iUP, it’s yours to keep.
With the iPhone Payments plan, you’re simply taking out a two-year loan on an iPhone with a carrier plan, but the loan is done through Apple’s financial collaborator, Citizens One. You won’t be able to trade it in for an upgrade after one year. You have to pay the full loan (though you could pay the loan off early if you wanted to).
On the iPhone Upgrade Program, AppleCare+ is folded into the cost, so your monthly payments are slightly higher, though you’re not paying any fees. It’s just the cost of an iPhone with AppleCare+ divided by 24 months.
On the iPhone Payments plan, you don’t have to buy AppleCare+. In fact, if you want it, you have to purchase it separately, which you can do on installments now.
If you like to upgrade your iPhone every year, the iPhone Upgrade Program is more your pace.
If you just want an iPhone, and don’t need AppleCare+ and don’t plan to upgrade every year, or even have a plan for future iPhone upgrading, the iPhone Payments plan will work for you.
So I can’t upgrade every year on the iPhone Payments plan?
Correct. The iPhone Payments plan is a loan financing program that lets you make monthly payments across 24 months on an iPhone. Even if you get rid of the iPhone a year or the day after you’ve made your final payment, you must pay the full amount (though you can pay the loan off early).
Do I have to get AppleCare+ with it?
Nope! One complaint I heard from some people interested in the iPhone Upgrade Program is that they’re forced to have AppleCare+, but with the iPhone Payments plan, you don’t have to.
In fact, if you want it, you have to purchase it separately from your loan. You can, however, make monthly payments for AppleCare+ now.
What is the interest rate?
Zero percent financing, my friend. That’s right. You won’t pay more than the actual cost of the iPhone plus taxes (through Apple), as if you were paying for it with cash upfront.
Can I use my Apple Card as a payment option?
You sure can. Once you’re approved for the loan, you can use your Apple Card as your monthly payment option, which gives you that sweet 3% cashback reward every time you make a payment.
Will there be a hard credit pull?
Apple’ states that “a credit check is required,” but doesn’t give a lot of detail as to whether it’s a soft or hard pull on your credit report. If it’s anything like the iPhone Upgrade Program, however, it’ll be a soft pull until Citizens One determines it needs a deeper credit check.
We’ll update this information as soon as we have more details.
A note about credit freezes
If you’ve put a credit freeze on your credit report, there are a few things you should know about applying for your iPhone Payments loan.
A credit freeze is a way for you to restrict access to your credit report to protect you from identity theft. If you’ve put a freeze on your credit report, it doesn’t affect your credit score or keep you from being able to apply for loans. There are some caveats though.
When applying for a loan through the iPhone Payments plan for the first time, you can allow Citizens One run a credit check, but you’ll want to first temporarily lift the freeze specifically for the credit report agency Citizen One will request your report from (either Equifax, Experian, or TransUnion).
You can request a credit freeze lift for a specific amount of time or for a specific agency, in this case, Citizens One Bank.
To find out which agency Citizens One will request your report from, call them at 1-888-201-6306. If you are unable to get this information, you can temporarily lift the freeze for all three agencies.
Here are the numbers for the U.S. credit report agencies:
- Equifax — 1-800-349-9960
- Experian — 1‑888‑397‑3742
- TransUnion — 1-888-909-8872
You’ll need to provide your name, address, date of birth, Social Security number and some other personal information.
Who is eligible?
Currently, the iPhone Payments loan program is only available to U.S. residents over the age of 18.
You’ll also need a valid U.S.-issued credit or debit card in order to enroll.
Can I buy an iPhone for someone else on the iPhone Payments plan?
You can buy the iPhone for anyone you want, but you’re the one responsible for payments. If you want to get your kid or spouse the new iPhone, go for it! Just remember that you’re the one Citizens One will contact if the payments are late. It’s just like any loan.
What do I need to apply for the iPhone Payments program
As mentioned above, you must be a U.S. resident over the age of 18 and you must have a valid U.S.-issued credit or debit card. Pre-paid cards are not accepted.
You’ll also need to make sure to temporarily unfreeze your credit report if you’ve frozen it.
When you apply, you’ll need to choose a carrier. If you already have a carrier account and want to add your new iPhone to the plan, you’ll need your carrier account information, including your account PIN if you’re with Verizon, so that Apple can confirm your eligibility.
If you don’t have it memorized, you should also have your social security number on hand for the credit approval process. You’ll be asked to provide some information about yourself, such as your address, phone number, and annual income.
Can I get a SIM-free iPhone?
Unfortunately not. The iPhone Payments plan is Apple’s financing option for buying an iPhone with a carrier plan. You’ll be buying an unlocked iPhone (unless you choose AT&T as your carrier), but you will be tied to the carrier plan you’ve chosen for the next two years.
Is the cost of the carrier plan included in the loan installment?
No. The iPhone Payments plan only covers the cost of the iPhone. You’ll pay for the carrier service separately and directly through your carrier.
What if I want to cancel or switch my carrier service plan?
If you decide, within the 24 months, that you want to switch carriers, you can’t take your iPhone Payments loan with you. You’ll have to pay the full balance of the loan in order to get out of your carrier plan.
So choose wisely, my young Padawan.
Can I trade in an old iPhone?
You sure can! You can trade in a phone as old as the iPhone SE for up to $45 off, all the way up to the iPhone XS Max for up to $600 off
Trade-in values for your old iPhone
- iPhone SE – Up to $45
- iPhone 6 – Up to 60
- iPhone 6 Plus – Up to $80
- iPhone 6s – Up to $100
- iPhone 6s Plus – Up to $120
- iPhone 7 – Up to $150
- iPhone 7 Plus – Up to $200
- iPhone 8 – Up to $$220
- iPhone 8 Plus – Up to $300
- iPhone X – Up to $400
- iPhone XR – Up to $370
- iPhone XS – Up to $500
- iPhone XS Max – Up to $600
Can I have more than one loan on the iPhone Payments plan at the same time?
Only with different phone numbers. You can’t apply, for example, for two iPhone Payments loans with your single Verizon account using the same phone number. You can apply for two different loans using two different numbers on the same carrier plan, though. If, for example, you’re on a family plan.
How can I get pre-approved for a preorder?
If you’ve decided you want to go with the iPhone Payment plan, and you’re hoping to pay for the iPhone 11 or iPhone 11 Pro with it, you can get pre-approved before preorders begin on Sept. 13. Once you complete the pre-approval process, you can wake up on Friday morning and just hit the “order” button to begin the process.
For preorders of the iPhone 11 and iPhone 11 Pro, the deadline to get pre-approved is September 12 at 9:00 PM PDT/12:00 AM EDT.
Currently, you can only get pre-approval for preordering a new iPhone through the Apple Store app on your iPhone.
Does pre-approval guarantee my preferred iPhone for preorder?
No. All it does is get your finances in order so that you can apply faster. It’s similar to making sure your credit card information is correct and up-to-date ahead of time.
To have a better chance at ensuring you get the iPhone you want, be sure to be up and ready to preorder at 5:00 AM PDT/8:00 AM EDT on September 13.
What if I’m already on the iPhone Upgrade Program?
You can’t transfer the payment of the iPhone on your iPhone Upgrade Program plan to the iPhone Payments plan. If you’re in the middle of your 24-month contract on the iPhone Upgrade Program, I recommend you finish off the program unless you’re willing to either pay off what you owe for the iPhone on the iPhone Upgrade Program in its entirety, or carry two different installment plans at the same time (one for the iPhone Upgrade Program and one for the iPhone Payments plan). The latter would mean you’d have two phones.
What if my loan isn’t approved?
Citizens One Bank may decline your loan request for any reason. If that happens, the Bank may send you a letter detailing the reasons why. You can also call Citizens One at 1-888-201-6306 for questions about your loan or decline of one.
Any more questions?
Please let us know what questions you have about the iPhone Payments plan and we’ll find the answer and drop it into this FAQ as soon as possible.