Smartphones make everyday life much easier. With this device, you can do many things, from logging in to your bank, getting directions, and checking the weather. But this convenience comes at a sky-high price. Premium smartphones, in particular, can set you back $1000 at the minimum.
For this reason, a phone rental may seem like a more attractive option than purchasing one. This enables you to have the latest models without the high sticker price.
What is a smartphone rental?
Smartphone leasing or smartphone rentals can be compared to leasing a car or an apartment. You sign a contract with a smartphone leasing company to get the rights to use the smartphone for a set period. In return, you will be making scheduled lease payments.
It is critical to know that leasing is not the same as buying a phone via an instalment plan. Most cell phone networks offer this option to make smartphones more affordable. For example, you can pay 24 monthly installments, after which you have total ownership of the phone.
But when you rent, you make one lump sum payment followed by weekly, bi-weekly or monthly fees depending on the agreed-upon schedule. This lease term can vary from one provider to the next.
- Get regular upgrades
Smartphone technology is constantly being developed, with new models being released regularly. If you are a tech fanatic, a phone rental makes upgrading to a news release easier. Depending on the lease term length, you can even obtain a new phone every year. This enables you to keep up with the latest technological innovations.
- Renting is a more affordable alternative than buying a phone outright
A smartphone from the top brands costs $1000 or more. But renting a phone only requires you to make a small down payment of $50 to $100 followed by fixed monthly payments.
If you turn in your phone for a new one after 18 months or after the set period of your contract and calculate that the total lease cost on your brand-new phone will be lower than its list price, then you will benefit from the deal.
But on the downside, you will be paying nearly the total cost of the phone without having full ownership of it.
- The Credit score is not an obstacle
Cellular service providers conduct a credit check as part of the application process for a contract. A poor credit score may result in service denial. You may be compelled to put down a larger deposit to obtain the phone. But with smartphone leasing, a poor credit score or having no credit history is not a barrier to getting the service.
- You may have the option of a buyout
In some cases, you have the option to purchase the smartphone you’ve been renting at the end of the lease term. It is critical to consider the buyout fee. This is the fee you pay to own the phone going forward fully . But the amount you will be paying to purchase a rented phone can vary from one provider to the next. So, it is crucial to examine the fine print. In this way, you can check the numbers to understand whether it is better to rent instead of buying the phone upfront.