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Financing options for cell phones

7 ways to get your hands on the latest iPhone, Galaxy or Pixel — possibly without paying interest.

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Cell phone costs can range from $450 to well over $1,000— and the options to pay for them have grown. Phone financing through a carrier, retailer or the manufacturer often offers the best deals, especially if you have a phone to trade in. As a last resort, you can also apply for a loan or put the expense on a credit card.

You may be able to include accessories in your purchase when you apply for cell phone financing. You can also use a credit card or personal loan to cover the cost of any accessories, including AirPods.

How can I finance a cell phone?

You have a variety of options to make your cell phone more affordable if you can’t cover the sticker price up front. You may even be able to finance a cell phone with bad credit, though your options are more limited. For example, the 0% APR financing options might not be available to you, but you might be able to get a loan through a retailer or separate lender.

How to get approved for a cell phone with bad credit

If you have bad credit, you can skip the credit check by signing up for a prepaid plan with a company or buying an unlocked phone. In some cases, you might be able to get a cell phone with bad or no credit by making a security deposit, bringing on a cosigner or joining a family plan with someone who has good credit.

Phone financing through your current carrier

This option is best for people who are happy with their current carrier, but want to upgrade their phone. Many providers offer a few options to finance a new phone:

  • Trade-ins. Trading in your old device can reduce the cost of your new phone to the point where you don’t even need financing — especially if it’s a newish model in good shape.
  • Interest-free installment plans. Most carriers also offer interest-free installment plans, usually along with a two-year contract. Some require a down payment, though you can often cover that by trading in your old device.
  • Leasing. Less common, some carriers allow you to lease a phone for two years. It works a lot like buying a phone and trading it in, only you won’t ever fully own it outright.★★★★★

The downside is that you’re locked in with this carrier for two more years. This means you won’t be able to get another phone on that plan for that period of time. And if you decide to switch, you’ll be on the hook for the rest of the balance.

Phone financing through a new carrier

If your current plan is up and you don’t mind changing service providers, you might be able to qualify for a signup deal by switching carriers. These vary depending on the provider and the phone. Some might cover the full cost of a phone, while others might offer a reduced monthly cost on the installment plan.

You might also be able to qualify for a signup deal if you’re adding a new line to your current plan.

Personal loans

Personal loans from a separate lender can be used to finance your new phone, although this option is best for people who’ve exhausted all other 0% interest financing options. Typically, rates run from 6% to 36% with terms from three to seven years.

While you need good credit to get the most competitive rates, there are personal loan options for all credit types. Make sure you’re working with a lender that offers loan amounts low enough to cover the cost of your phone — as many lenders start at around $2,000.

Name Product Filter Values APR Min. credit score Loan amount
LightStream personal loans
Finder Score: 4.8 / 5: ★★★★★
LightStream personal loans
7.49% to 25.99%
Good to excellent credit
$5,000 to $100,000
Borrow up to $100,000 with low rates and no fees.
PenFed Credit Union personal loans
Finder Score: 3.6 / 5: ★★★★★
PenFed Credit Union personal loans
7.99% to 18%
$600 to $50,000
With over 80 years of lending experience, this credit union offers personal loans for a variety of expenses.
Finder Score: 4 / 5: ★★★★★
8.49% to 35.99%
$1,000 to $50,000
Check your rates with this online lender without impacting your credit score.
Best Egg personal loans
Finder Score: 3.8 / 5: ★★★★★
Best Egg personal loans
8.99% to 35.99%
$2,000 to $50,000
Fast and easy personal loan application process. See options first without affecting your credit score.
Credible personal loans
Finder Score: 4.3 / 5: ★★★★★
Credible personal loans
4.60% to 35.99%
Fair to excellent credit
$600 to $100,000
Get personalized prequalified rates in minutes and then choose an offer from a selection of top online lenders.
Freedom Debt Relief
Not rated yet
Freedom Debt Relief
Starting at $4,000
Freedom Debt Relief works to help people with unmanageable, unsecured debt get back on their feet.

Manufacturer phone financing

If you prefer to buy an unlocked phone through the manufacturer, this option may be the way to go. Apple and Samsung offer financing plans that you can sign up for, as do other cell phone manufacturers.

  • Interest-free installment plans. Apple works with Citizens One and Samsung partners with TD Bank to offer 0% APR installment plans. You might have to pay interest if you’re unable to make repayments, however. And you usually need excellent credit to qualify.
  • Credit cards. The Apple Card and Barclaycard Financing Visa both offer interest-free financing to cover the cost of your new iPhone.

Like with carrier financing, you can often trade in your phone to reduce the total cost.

Retailer phone financing

Some retailers like Best Buy offer credit cards that give interest-free promotional periods of around two years to pay off the cost of a new cell phone. But beware: Interest will be charged from the purchase date if you fail to pay off the balance before the promo period ends.

Others use third-party services like Affirm to offer personal loans you can use to finance your purchase at check out — though you’ll have to pay interest. Some also use companies like SmartPay to lease phones.

These options are best for people with strong credit who can qualify for 0% APR financing. However, Affirm is available to a wide range of credit types.

Buy Now Pay Later (BNPL) apps

BNPL apps like Klarna, Afterpay and Sezzle let you to make purchases online and are best for people who want to split the cost of their phone into four interest-free payments. The first payment is due at checkout, with the rest of the payments due every two weeks.

While the repayment term is quick, these apps let you pay off your phone over six weeks instead of immediately. These apps also work with Apple Pay and Google Play.

Credit cards

As a last resort, you can also use your current credit card to cover the cost of your new phone. This is generally the most expensive option, since credit cards tend to have higher rates than personal loans. However, it might be worth it if you can qualify for a new credit card that offers 0% APR for a promotional period of 18 or 24 months. That way you won’t be tied to a carrier plan.

These personal loan providers offer loans to borrowers with a range of credit scores. Compare offers and get approved for amounts as low as $1,000 which can be used to buy a phone.

5 tips for cell phone financing

Before shelling out hundreds of dollars for a new cell phone, consider these tips to ensure you find the right financing for your needs:

  • Trade in your old phone. Trading in your old phone can shave hundreds of dollars off the upfront or monthly cost, regardless of where you buy it.
  • Consider your travel plans. Plan on moving abroad or traveling a lot over the next few years? You might want to think twice before locking yourself into a two-year contract.
  • Finish your contract before switching carriers. This is especially important if you’re still paying off another phone — you might have to pay back interest for breaking your contract early, making it more expensive than if you saw it through.
  • Have a plan before you swipe. Got a card with a 0% APR intro offer? Calculate exactly how much you’d have to pay per month to avoid paying interest once the promotional period is up.
  • Read the fine print. Look at your contract for circumstances you could end up paying hefty fees or interest for before you sign.

Bottom line

You have a wide range of interest-free options when it comes to financing a new cell phone. Make sure you consider those first before turning to more expensive choices like personal loans or credit cards. You can learn more about how borrowing works by reading our guide to personal loans.

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