Considering joining Apple's new iPhone Upgrade Program when you pick up a new iPhone XR? Here's everything you need to know before signing up.

What exactly is the iPhone Upgrade Program?

This is Apple's response to carrier deals that allow you to finance your phone for a set amount each month. The iPhone Upgrade Program lets you buy a new iPhone over the course of 24 payments; after 12 of those payments, you can automatically upgrade to the new iPhone—no hassle or extra fees required.

Previously, carriers offered you a set subsidy on your phone—somewhere between $300-$400 off—in return for signing a two-year contract; now, those subsidies are disappearing, being replaced instead with monthly plans from those carriers for paying off that expensive new iPhone. It makes sense that Apple got into the game.

For more information on the different options and ways to buy your iPhone in the U.S., check out our buying guide:

Wait, why does it make sense that Apple would get into this game?

In part, it frees users from having to be locked to a single carrier for two years: When you sign up for the Upgrade Program, you choose your new carrier (or continue with your current carrier plan); if, after twelve months, you dislike the plan, you can leave it and switch to a different carrier without the hassle of getting out of a carrier-specific two-year plan.

It also gets more people to buy iPhones every year, which, for Apple, is always a good thing, and to buy them through the Apple Store or online Apple Store.

What iPhone models are available?

You can only sign up for the iPhone Upgrade Program if you want to purchase an iPhone XS, iPhone XS Max, or the iPhone XR. If it's an older iPhone model you want, Apple is currently only offering a trade-in program.

Is it only available in the U.S.?

Not any more! Last year, Apple opened the iPhone Upgrade Program up to the UK and China as well. So far, no other countries appear to have an iPhone Upgrade Program at this time (Sorry Canada).

Oooh, AppleCare+ too? What does that cover and cost?

AppleCare+ is the company's iPhone-specific version of their popular AppleCare support service: It covers all the awesome telephone support and software advice that a regular AppleCare subscription does, and tacks on coverage for two accidental damage incidents.

Now, when I say "coverage," that really just means "option to pay $100 for a new iPhone after you drown your old one or $29 for a cracked screen." It's not a cheap repair—but it's much cheaper than if you broke your screen sans AppleCare+ (Take it from someone who only had to pony up $99 after drowning her husband's brand new iPhone 7 Plus).

Normally, AppleCare+ costs $199 for two years when you purchase your device; with the iPhone Upgrade Program, you get AppleCare+ as part of your monthly fee.

You can opt to upgrade your AppleCare+ coverage to include theft or loss for an additional $4.71 per month.

Okay! So how much is the program going to cost me per month?

Though it's still not too much to put out each month, it's definitely getting a little pricier each year. You'll be paying $68.66 per month if you get the high-end, largest capacity iPhone XS Max. The iPhone XS starts at just $49.91 per month and the iPhone XR starts at $37.41 per month. Here's how it looks after 24 monthly installments.

iPhone XR with AppleCare+

  • 64GB: $37.41/month ($897.84 total)
  • 128GB: $39.50/month ($948 total)
  • 259GB: $43.66/month ($1,047.84 total)

iPhone XS with AppleCare+

  • 64GB: $49.91/mo ($1,198 total)
  • 256GB: $56.16/mo ($1,348 total)
  • 512GB:$64.50/mo ($1,548 total)

iPhone XS MAX with AppleCare+

  • 64GB: $54.08/mo ($1,298 total)
  • 256GB:$60.33/mo ($1,447 total)
  • 512GB: $68.66/mo ($1,647.84 total)

Remember, the total price after two years includes AppleCare+ coverage.

How long do I pay this monthly fee?

When you sign up, you're contracted with Apple (and its loan partner, Citizens Bank) for 24 months (two years). You can upgrade to the next-generation iPhone after only 12 months of payment; when you do so, you're essentially renewing your 24-month hardware contract with Apple (and Citizens).

If you decide before the 24 months are up that you want out of the iPhone Upgrade Program, you will be required to pay the remainder of the cost of the iPhone and AppleCare+ and then the device is yours. AppleCare+ will be good for two years from the date you originally signed the iPhone Upgrade Program contract.

What do I need to sign up for it?

You'll need to have a valid credit card, decent credit, and whoever is paying for it needs to be over the age of 18. This is because technically you're signing up for a 24-month interest-free loan from Citizens One—via Apple's retail stores—so you need all the bits and bobs a company would usually require for a financing deal. Citizens One will run a credit check to approve you for the loan.

Get pre-approved for your loan.

In order to expedite the process of getting your new iPhone, Apple has implemented a pre-approval feature that is already underway and available for returning upgraders and newly enrolling customers.

Enrolling to purchase an iPhone that is already on sale

You can enroll or re-enroll at Apple's website to purchase an iPhone that is available now (not in pre-order) by visiting Apple's iPhone Upgrade Program page and clicking on Join Now or Check your upgrade eligibility to get started.

You can also enroll from the Apple Store app.

  1. Launch the Apple Store app.
  2. Select the iPhone model you want to purchase on the iPhone Upgrade Program.
  3. Select whether you are Replacing your current iPhone or buying a new iPhone on an existing carrier account.
  4. Select your carrier.
  5. Select your finish.
  6. Select your capacity.
  7. Select Apple iPhone Upgrade Program when asked how you would like to pay.
  8. Select I'd like to enroll if you are new to the program or I'm already part of the program if you are currently enrolled in the iPhone Upgrade Program.

You will then follow the instructions to complete your loan approval process to enroll or re-enroll in the iPhone Upgrade Program.

Enrolling to purchase an iPhone that is in pre-order

Currently, Apple only allows you to get loan pre-approval for preorders like the upcoming iPhone XR from the Apple Store app on your iPhone (not available on iPad).

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  1. Launch the Apple Store app on your iPhone.
  2. Tap View pricing or Preorder (depending on what the status of the preorder is).
  3. Tap Get Started at the top of the page under Get ready for pre-order now with the iPhone Upgrade Program.
  4. Tap Get ready for pre-order now if you are enrolling for the first time or Get a head start on your upgrade if you are currently enrolled in the iPhone Upgrade Program and follow the instructions to check your eligibility.
  5. Select the iPhone model you want to preorder.
  6. Tap Get Started.
  7. Select your carrier.
  8. Select your finish.
  9. Select your capacity.
  10. Select the AppleCare+ coverage you want (if you want to upgrade to AppleCare+ with Theft and Loss).
  11. Tap Confirm iPhone Preference.
  12. Tap Continue to go to the next section.
  13. Confirm your carrier. You'll need the wireless number for the phone you would like to replace and your 4-digit account PIN.
  14. Tap Continue.
  15. Tap Continue to go to the next section.
  16. Fill out the personal information needed to get loan approval for the iPhone Upgrade Program. You'll need to enter your Social Security Number, your billing and shipping address, credit card payment method, date of birth, and total annual income.
  17. Tap Continue to get pre-approval.

Your preapproval will last three days after pre-order begins. Once pre-order ends, outstanding preapprovals will expire.

Getting pre-approval for an iPhone pre-order *does not** reserve an iPhone for you. It is still a first-come, first-served basis. Going through the preapproval process allows you to select the model you want for faster checkout than starting from scratch.

A note about credit report pulls

There's been a lot of confusion about whether Apple does a hard or soft pull on your credit report to approve you for re-enrollment. That's because each candidate for a loan is different. Apple's iPhone Upgrade Program overview states:

Citizens One reserves the right to perform a credit inquiry as needed to determine loan eligibility. Depending on your account performance and transactional history in the iPhone Upgrade Program, Citizens One may approve your new loan application without your credit being affected.

Basically, Citizen One, the banking organization Apple works with to process loans, may only do a soft pull on your credit report if it considers your previous activities in the iPhone Upgrade Program to be in good standing. If, however, Citizen One deems it necessary to research further into your credit data, it might do a hard pull.

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 Upgrade Program 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.

  • If you are already signed up with the iPhone Upgrade Program, Citizens One will still be able to access your credit report for a soft check. The Federal Trade Commission states:

    Your report can be released to your existing creditors or to debt collectors acting on their behalf.

  • If you are joining the iPhone Upgrade Program for the first time, you can still have 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), but there is a fee. The Federal Trade Commission states:

    If you opt for a temporary lift because you are applying for credit or a job, and you can find out which credit reporting company the business will contact for your file, you can save some money by lifting the freeze only at that particular company.

The credit report agency must lift the freeze within three business days of your request.

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, but you'll have to pay the fee for each one. Fees range in price from $5 to $10 but are different in each region.

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.

Do I still have to sign a two-year carrier contract?

Nope! While you'll be required to choose a carrier when you sign up for the Upgrade Program, you're not locked in for two years with that carrier as you would be in the traditional subsidy program. And, if after twelve months you don't like the carrier you're with, you can ditch them and choose a new carrier with your new iPhone.

Currently, Apple works with AT&T, Sprint, T-Mobile, and Verizon. At this time, you can't purchase a SIM-free iPhone through the iPhone Upgrade Program. After 12 months, if you decide to switch to a different carrier, you will be directed to choose from one of the four listed carriers.

Of course, in theory, the iPhone's Apple SIM should let you swap between networks at any time, but U.S. carriers have instantly locked that SIM in the past when you signed up for service so that you couldn't do so. Lame, carriers. Very lame. Worst-case, I suppose you may be able to switch by swapping out the iPhone's activated Apple SIM card with a different carrier's SIM.

Will the carriers punish me for not getting a phone through them?

Nope: To them, your iPhone looks just like an unlocked, prepaid phone on their network; that means you should get charged non-subsidy pricing, same as you would if you signed up with AT&T Next, Verizon's upgrade program, or any of those plans.

Okay, so how do I sign up?

You can either buy your iPhone online, use the Apple Store app (required for iPhone pre-orders), or head down to your local Apple Store and buy your iPhone in-person. If you'd like to make an in-store reservation, visit Apple's website, choose the iPhone model you want (if available) and go from there.

Can I have two different iPhones on the iPhone Upgrade Program

You sure can. Each phone will have its only separate finance contract. So, keep in mind that you'll have to make two payments every month, even though they're going to the same place.

When and how exactly do I get a new iPhone after I start the Upgrade Program?

After you've been paying installments for 12 months, you can trade in your old iPhone for the next version. I recommend checking your eligibility first. If you're upgrading online, you'll be asked to sign a new 24-month contract and you'll have the option to trade your old iPhone in at an Apple Retail store in-person or have a Trade-in Kit mailed to you.

That said, there is a fun little loophole here, if you're the type that likes paying for things in advance. Once you've been part of the program for six months, you're eligible to upgrade as long as you pre-pay the next six payments (for a total of 12) before doing so. That means, if you wait to sign up for the iPhone Upgrade Program any time from October to March, you can still get a new iPhone in September 2019 if you pre-pay six of those payments.

But I can't sign up next June when my current carrier contract runs out and get the next iPhone when it arrives in September, right?

Right. If you signed up in June 2018, the earliest you could get a new phone would be December of 2018 if you pre-paid for six months, or June of 2019 if you wait a year—best to wait until you're on the right hardware cycle.

What kind of condition does my old iPhone have to be in when I trade in?

Apple's terms and conditions state the following:

For a Financed iPhone to be considered in good physical and operational condition, the Financed iPhone must:

  • Power on and hold a charge;
  • Have an intact and functioning display;
  • Have no breaks or cracks; and
  • Have Activation Lock disabled (you may be asked to disable at the time of upgrade).

If you've broken or otherwise shattered your iPhone, you'll need to pay the AppleCare+ fee to fix it; if you're out of AppleCare+ incidents, you're required to pay the Apple Authorized Service charge (something in the realm of $200).

What if I lose my iPhone or it gets stolen?

If you upgraded to AppleCare+ with Theft and Loss, you can fill out a claim form at Apple's claims site.

If you are on the standard AppleCare+ for iPhone and your iPhone, you will not be eligible for the Upgrade Option and Apple notes that you should cancel your current plan by calling AppleCare at (800) 275-2273.

Does the 24-month contract reset when you get a new iPhone?

Yep! When you upgrade after 12 payments, you'll sign a new 24-month contract.

What if my iPhone doesn't arrive for a month after I ordered it?

It's not uncommon for your iPhone to take a few weeks to be delivered, especially if you upgrade right at the launch of a new iPhone. If you re-enroll in the iPhone Upgrade Program, your enrollment starts on the date of your order, not the date of your iPhone's arrival. This is to ensure that your upgrade cycle isn't thrown off because of delayed shipping.

Can I use this as a way to finance a new iPhone even if I don't want a new phone after a year?

Yup! You have the option to get a new iPhone after 12 payments, but you're not required to upgrade if you don't want to. After 24 months, you've essentially paid the full price of the device and AppleCare+, and it's yours to keep.

I pre-ordered a full-priced phone but now I want to go the Upgrade Program route! Can I do that on launch day?

Possibly, but it depends on Apple Store stock. Most likely, you'd need to return the phone you signed up for and replace it with one from Apple's Upgrade Program stock (which may or may not be available on launch day). If you've got FOMO and just have to have your iPhone on day-one, you might not want to risk trying to switch to the iPhone Upgrade Program after you've already per-ordered.

What if I pay the full 24 months, but decide to upgrade after two years?

That's not a problem. The iPhone you paid off in the iPhone Upgrade Program is yours to keep. You'll re-enroll with a new finance contract, but it'll feel like you never stopped (except that you now have two iPhones).

Other questions about the Upgrade Program?

Let us know and we'll try and sleuth them out.

Updated October 2018: Updated with steps for getting loan pre-approvals for iPhone pre-orders.

Serenity Caldweel contributed to an earlier version of this guide.

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