Mobile phones make life simpler in many different aspects on a daily basis. A mobile phone enables you to do a wide variety of tasks, such as logging in to an online banking account, obtaining driving instructions while going on a road trip, and checking the weather. This ease, however, may come with a cost attached to it. As of 2020, the price of certain luxury mobile phone models is expected to average over one thousand dollars. If you want the newest model of a mobile phone but don’t want to spend as much money on it, mobile phone rental may be a better alternative for you than purchasing one. This is especially true if you rent rather than purchase.
What Is Mobile Phone Rental?
Mobile phone rental is comparable to renting other consumer goods such as automobiles and housing. The mobile phone is rented from a mobile phone rental firm for a certain amount of time in accordance with the rental terms. As compensation, you pay rent each month.
Renting is not the same as purchasing a phone via an instalment plan, which is offered by several mobile networks to help lower the upfront cost of mobile phones. Spectrum, for instance, offers 24-month financing, after which you’ll own the phone altogether.
Typically, a rent agreement calls for a single upfront payment followed by weekly, bimonthly, or monthly instalments. Rent duration might vary widely depending on the service provider.
At the expiration of the rent period, you may choose to:
- You may hand in the phone and start renting something new.
- Renew your contract for the same mobile device.
- Get rid of your phone rental and buy it outright.
Renting additional phone accessories like headsets and vehicle chargers is also an option. Rent payments apply solely to the phone’s physical usage; you’ll have to budget for cellular service on top of that.
The Benefits and Drawbacks of Mobile Phone Rental
Sometimes, mobile phone rental makes more financial sense than purchasing one outright. Whether it’s a good fit for you depends on factors, including your income, debt, and other loans. The advantages and disadvantages of mobile phone renting are briefly discussed here.
Upgrades Are Offered on a Regular Basis
The mobile phone industry is rapidly developing and refining new models every few months. Renting a mobile phone makes it more convenient to update whenever a new model is out, which is ideal if you’re a tech nerd. With a phone rental, you may acquire a whole new phone every year, enabling you to stay abreast of the latest features and innovations in the industry.
It Might Be Less Costly Than Purchasing
Even if the price of a top-tier mobile phone may easily reach $1,000, the average mobile phone will only cost its buyer $363 in 2021. Rent often requires an upfront payment of $50 to $100 and then minimal monthly instalments. With $0 down, you can rent a Samsung Galaxy A11 from T-Mobile for as low as $8.25 per month over the course of 18 months. In comparison to the phone’s regular list price of $180, that’s a savings of $32.50, bringing the total to $148.50.
You will continue to save money if you trade in your phone after 18 months and get a new one with a rent payment that is less than the phone’s retail price. It’s still the case that you won’t own the phone, but you’ll have spent close to the full retail price.
Credit May Not Be an Issue
When applying for a contract phone with a cellular operator, a credit check is often performed. If you have bad credit, you could still be able to buy a phone, but you might need to put down a bigger deposit. Renting a mobile phone might be an option for those with no credit history or limited credit history.
The Phone Is Owned by the Renting Provider
Mobile phone rental means that you are not the legal owner of the device but rather the lessor. That’s just another example of how renting a house or car is comparable to renting a car or apartment. In contrast, once you’ve paid for a mobile phone, you own it forever. In other words, you are free to do anything you choose with it, including keeping it or selling it. If you want to keep the phone when the rent is over, you’ll have to purchase it.
There Might Be Buyout Fees
You should think about the buyout charge if you rent a mobile phone and have the opportunity to buy it at the conclusion of the contract. This is the ongoing cost of phone ownership. Renting a phone might range in price from one provider to the next, so it’s vital to compare plans and prices before committing to a provider. That way, you may compare the costs of purchasing the phone outright with those of renting it first and then buying it.
Additional Costs May Apply While Renting
If the rented vehicle has excessive wear and tear or mileage when returned to the dealership at the conclusion of the rent, the lessee may be responsible for paying extra costs. When you rent a smartphone, the same thing might happen. Returning a gadget with damage beyond what is considered normal wear and tear may result in additional charges.
The Bottomline
We are living in a time when mobile phones are everywhere and altering our daily lives. If you don’t want to be tied down to a certain smartphone model for an extended period of time, mobile phone rental might be an option to explore. If you’ve done the math and found that leasing is cheaper than purchasing a phone outright, then you could also be a suitable candidate for phone leasing. It’s essential to read the fine print of any smartphone lease you’re considering signing to ensure you completely grasp your financial obligations and your alternatives after the lease period ends.
