Generally speaking, financing on smartphones allows you to pay over time. You select the smartphone you want to purchase and then apply for financing. If approved, you might be required to pay a modest initial deposit. For certain types of financing for smartphones, there is no down payment necessary. For others, you might be able to get a revolving line credit.

For instance, you could be required to pay back the balance over 24 or 48 months. But that does not mean that financing a smartphone is free. If you do not complete the purchase by the expiration of the promotional time, then interest charges could be applied retroactively to your purchase price at the time of purchase. A credit check could be required to qualify for smartphone financing. You must meet other requirements to qualify for a payment installment plan.

Types of Financing for Smartphones

The financing for smartphones can come in various kinds, depending on the company offering them. It is important to be aware of this when comparison of financing terms. Here's a brief overview of various ways you can pay for the purchase of a phone.

Retail smartphone financing

The most popular method of financing smartphones is to use an online store. Best Buy offers, for instance, offers a 24-month financing option for phones that are not locked as well as Geek Squad purchases above a specific amount. You'll need a Best Buy credit card to avail of this financing. The card is free of interest when the balance is settled in full within the first 24 months from the date of purchase. Purchases made using the Best Buy credit card can also earn rewards.

Financing a smartphone with an online retailer could require a thorough credit assessment if you're opening credit at a store that could immediately drop your score. Although some retailer cards provide financing for promotional purposes, it's important to know that the annual variable percentage rates (APR) on purchases might be much higher than what you'd pay for traditional credit cards.

Cellphone company smartphone financing

Another way to finance smartphones is to go through your phone service provider. Verizon is one example. It lets eligible customers purchase smartphones in installments and pay no interest or cost for financing. You'll need a two-year contract to avail of this feature, and an upgrade fee is also applicable.

If you don't have plans to switch cellphone providers shortly and want to purchase a new device, this method could be beneficial. With Verizon as an example, you can have up to 24 months to pay for your phone in installments. Of course, the only drawback is that you're bound to the new contract. If you choose to change the company you use for your cellphone, you may incur a charge when it breaks the terms of your contract.

Financing for cell phone manufacturers

Depending on the phone you're interested in, you may be able to obtain financing from the manufacturer. The two companies, Samsung and Apple example, provide promotional financing to buyers looking to buy new phones and pay them off over time. For Samsung, it is necessary to apply for a financing account. For Apple, it is required to be a holder of the Apple Card.

The benefit of these kinds of loans is that they can utilize them to buy more than smartphones. Samsung Financing coul buy appliances or TVs as well as Apple Card to purchase Apple Card to buy AirPods as well as the Apple Watch, iPad, or Mac. If you're loyal to one of these brands, you might prefer this kind of finance; however, you must be aware of the interest rate and the fees.

Financing BNPL

BNPL is a rising trend in financing for short-term needs. Also known as installment loans at the point of sale, BNPL platforms allow you to make purchase with a modest down payment and repay them with four or more payments. Affirm, for instance, allows you to finance smartphones.

BNPL financing could make you money since certain options do not charge any fees or interest. But not every mobile firm can use BNPL platforms, which might limit your options. One of the main complaints about BNPL finance is that it could result in the cycle of debt if you're using multiple installment payment plans.