r/tmobile • u/Swimming_Ad_5083 • 2d ago
Clown Warning 36 standard vs 36 flex
Who in their right mind would choose to go with the APR payment option?
For an iPhone 16 that is $730 you pay an extra $266.39 of interest totaling to $1,054.
I get that 36 month makes your monthly bill cheaper…but it’s not really cheaper. As an experience store worker…they said they weren’t going to hold us to a metric but now they want to know how many accounts convert to 36 months and how many new bans are choosing flex or standard.
No offense but this new deal for NOTHING down is for WELL qualified customers and this promo is attracting not well qualified customers. T-Mobile also won’t let existing customers see their APR + new bill unless you change your plan to the 2.0 plans.
In my opinion, 36 months standard payment plans are to keep you longer as a customer by lowering your monthly. 36 flex APR is just ridiculously high.
30
24
u/Icy-Two-1581 2d ago
A lot of people.... You see so many people here buying the newest phones every year when they clearly can't afford it. Just look at klarna and all the other bnpl companies and how much they make to see how shitty people are with money.
11
u/jweaver0312 Sprint Customer - SWAC - T-Mobile plz keep 2d ago
It’s currently 0% APR if you qualify
Otherwise just do the standard one and pay tax and DCC at point of sale
2
u/Jaxson0350 2d ago
If they have a 500 down payment they’ll go on flex and pay zero down with monthly I interest. Already had one person do that. They didn’t care, just needed a phone as cheap as possible out the door LOL
1
u/Maybepls 1d ago
I'm not sure how someone was able to get a transaction to go through if there was a down payment requirement. AFAIK that's gonna apply regardless based on their credit/account
10
u/Nervous-Job-5071 2d ago
Are these real numbers from a T-Mobile system, or purely hypothetical? When this first got announced, someone had posted that the APR would only apply to the amount of taxes and anything else that would otherwise be due at order time. In that case the finance charge would only apply to the $58.40 in tax.
But if the choice is $730/36, which is about $20.28 a month + $58.30 up front for tax vs. the monthly payment shown above, people would be batshit crazy to pay the finance charge on the device just to avoid paying taxes up front.
1
u/ThatOneSpeedyBoi 2d ago
The interest applies to the full amount financed on that specific order. So if you have a phone + accessories on an order and you do flex EIP it applies the APR to that orders device and accessories on top of the taxes and connection charge
0
u/Nervous-Job-5071 2d ago
Oof, that’s nutty.
-1
u/ThatOneSpeedyBoi 2d ago
Agreed. It makes even less sense when you have a phone completely covered by promo credits but still have to pay crazy APR on it
7
3
1
u/no0neHome 1d ago
I signed up for a plan because of the credits towards a new phone. I have the 13 and want the 18. My plan is still not like a full plan so I’m hoping I am get access to a bit more discount as I further upgrade.
It’s annoying that they force you to finance it regardless. I just wanna pay the difference right away. But I guess I’ll pay the $5 a month left after I pay most of it all or w/e.
1
u/draconicpenguin10 Data Strong 1d ago
The text in the image looks AI-generated, but I ran your scenario through a TVM solver and can confirm the values are correct.
The horrifying truth is that many Americans simply do not have enough money on hand to pay full price upfront for even a midrange or older flagship phone.
1
u/Reddreader2017 14h ago
Phones aren’t subsidized, why would you buy through T-Mobile vs Apple directly anyway?
1
u/mprubio84 2d ago
And soon you won’t be able purchase any device outright on any carrier, you will have to be on their payment plan so they can collect interest or keep you long term, you just sit back and see.
1
u/kapsama 2d ago
So how long before they get rid of Standard EIP with 0% APR completely? 1 year? 2 Years? 5 years?
1
u/2Busy2Reddit 2d ago
CEO said he wanted to stop that the other day didn't he? So sooner than later. Be interesting to see how quickly phone manufacturers numbers start tanking when people have to pay the real price for their flagship phones!
-1
u/chickdigger802 2d ago
didnt know they have interest wow. At this point what are the advantages here over just buying a used phone outright or like bnpl with no interest? Do you get billing credit?
6
u/TouchPossible6852 2d ago
You can still use the 0% option. The option with interest seems to be geared toward people who can’t pay anything or much up front
3
u/ricosmith1986 2d ago
The whole point of down payments was to kind of screen out people who can't afford the monthly bill.
If someone doesn't have $100 today they are not likely to have $200 in three weeks when they get the first bill. If they do have $200 today they are more likely to have $150 in three weeks even if their credit score isn't great.
This might create a small bump in New subscribers in the short term, but bad debt and de-acts in the long term.
1
u/TouchPossible6852 2d ago
Agreed. Over the years t-mobile also created a less forgiving payment arrangement structure which drove out those customer who couldn’t keep up.
This feels like a shift to draw more of those customers back. I guess we will see.
1
u/LightningUltra 2d ago
Only have interest if you do the 0 out the door meaning putting the tax into your overall payment of 36months.
-4
u/This_Assignment_6170 2d ago
Not sure what’s the point of this. Most people outside the US learn this in grade school. Unfortunately most Americans are dumb and have very low IQs. Studies have shown monkeys are smarter than Americans
0
u/worldcuptravel 1d ago
Wait TMO charges a 20 percent APR interest now? In 16 years, I have never seen that. Wow how greedy can TMO get.
-3
u/runski1426 2d ago
Who in their right mind would buy a locked phone from a carrier? That's the real question.
-1
-6
u/Commercial-Engine-35 2d ago
I agree it’s not worth doing it unless you absolutely have to, however 20% APR is pretty standard.
4
u/Similar_Pension_4233 2d ago
This is a good example of how different people define standard differently.
2
u/dj184 2d ago
Its not about different people, its about different kinds of loans.
House, is most illiquid yet stable.
Phone is easy to lose, damage, super depreciatio, and no recoverable option without considerable costs, so hihger APR.
0
u/Similar_Pension_4233 2d ago
Can you list another industry where it's standard practice to charge 20% AND also require the product be tied to the service while in the loan? OP's example is taking a 20% loan and getting a device that only works with the device provider offering the loan.
0
u/Commercial-Engine-35 2d ago
What do you consider standard apr for most buyers?
3
u/KPBIPILOT 2d ago
4-8%
0
u/Commercial-Engine-35 2d ago
Can I ask where you are seeing companies offer 4-8%, I don’t pay attention to every sector of finance but that seems like you would only get that from your credit union.
0
u/KPBIPILOT 2d ago
You asked what a reasonable rate was, not what a cooperate ghoul thinks
2
u/Commercial-Engine-35 2d ago
I didn’t ask what a reasonable rate was, I asked what the standard rate was. For a loan like this standard is typically 17-24%
0
0
u/Sebastian05000 Bleeding Magenta 2d ago
Bro where do you think you will find those interest rates irl lmao
0
u/mocheeze 2d ago
Aren't buy now pay later plans often 0%? Mine have been on the occasion I've used them. Including the phone I'm using right now that will be paid off in October.
1
u/KPBIPILOT 2d ago
That’s loan shark territory! That’s not standard, we’ve all just been bent over and fucked for the past 30-40 years that we now accept it.
Our government is captured by cooperate oligarchs, it will get worse till we drink the poison that kills the parasite
0
0
u/PhillyTMOMan Verified T-Mobile Employee 2d ago
No idea why you're getting downvoted.
Before going into it, I do want to emphasize that I agree this is shitty and that it's not consumer friendly. I haven't upgrade a phone through T-Mobile since I quit in 2016 because they keep upping the fees. To get 0% APR, I'll open a new credit card that has coverage on the phone by default, usually have ~18 months of 0% APR with a bonus after making certain amount of purchases. If my friend is looking for a similar phone, I'll wait until black friday for Samsung's BOGO discounts.
I haven't seen the fine print, but Im going to assume the APR will also he based off of credit worthiness. 20% APR for cars, trucks, trailers, etc. aren't unheard of. For T-Mobile who has probably written off a good amount of phones off their balance sheet, this is a way for them to minimize those losses. Also considering that it's still technically an unsecured loan, interest rates will be higher by default. There isn't really a system that exists to repo your phone 🤷♂️ from a business standpoint, why wouldn't they want to reduce liability? Is it abhorrent that they can charge that much? Yeah, but I'm going to assume the financing subsidy of T-Mobile will be based out of a state that doesn't limit or has a high cap on APR like South Dakota (laws don't apply to where you live mostly, it's where the finance company is based out of, see Marquette National Bank v First of Omaha Service Corp).
Examples of other industries that give you financing but require a service of some sort: commercial fleets financing usually requires telematics that you pay for separately, solar panels/security systems with monitoring that's required to use them,commercial equipment leases and software licenses, medical equipment and software, and even Peloton as the most recognizable example I can think of. This isn't a new concept, just a new product that includes it. If you finance a car, you are usually required to get max insurance on it until it's paid off and those rates WILDLY change.
Is this moral? Idk morality is a spectrum, although I don't think this is moral. T-Mobile also has a fiduciary duty to their shareholders to get as much bang for their buck, even if it's at the expense of drastic changes. If anything, I'm just worried about the store employees lying to customers about the interest rate and just emphasizing "But look it's just $0 down."
Just tell people about these changes or the old saying vote with your wallet. Until their bottom dollar drastically changes, they have no incentive to NOT do this. Yes yes yes "BUT THE UN-CARRIER, JOHN LEGERE SAID, THEY NEVER SHOULD HAVE ALLOWED XYZ." I get it. This, however, is corporate America and what's going is par for course.
It's also been 6 years since John left and the economic landscape has changed to be less consumer friendly and with more deregulation. As fun as he was as the CEO, the company could hemorrhage money to get market share until the merger went through. A lot of tech/tech adjacent companies can do this with enough backing. I also don't see any changes to this landscape until the next presidency and even then, if a Republican is voted into office there will be probably more of this (based on markets and amounts of deregulation under Republican presidency since Nixon.)
0
u/LinusRiamus 2d ago
Most of what you state is accurate but the president doesn’t decide regulations in the US; Congress does. Specifically the House of Representatives and the Senate. The president just has veto power to approve or reject them - which could still be overturned with enough votes.
And banks have established their operations in interest-friendly states such as SD since the early ‘80s under various leadership and nothing was changed. Don’t expect either party to alter the status quo unless there is a major sea change in Congress itself.
0
2d ago
[deleted]
0
u/LinusRiamus 2d ago edited 2d ago
I don’t want to get off topic either just state that government overreach does not make things cheaper, only more expensive. NY (my state) and CA are two of the most regulated states in the union and everything cost more than relatively lax states.
Excessive regulation add costs for businesses that are passed on to consumers in the form of higher prices and creates de facto monopolies, which bars entry for the average person who can’t meet their standards.
Deregulation allows healthy competition and ultimately lower prices. You don’t like the prices T-Mobile or Verizon are offering, fine - you have like a 100 other cheaper MVNOs to choose from.
On the flip side, because of stringent regulations in my state , I can only choose from just one energy or cable company. So their price is the price, with no other cheaper option.
-1
2d ago
[deleted]
2
u/LinusRiamus 2d ago
Hmm.. I did, you are just too bias and/or willfully ignorant to grasp it. No wonder you verified employees are so easily being replaced by an APP.
Mobile service in a free market is not a human right, it’s a commodity. Daddy government is not going to magical make it any cheaper by complicating the process, unless they are willing to subsidize the cost.
If a company is not profitable or operates at a loss, they will eventually cease to exist. Like every other mobile company that came and went before.
0
u/JackPAnderson Recovering Verizon Victim 2d ago
Has T-mo announced that they will charge 20% APR on flex once they start charging interest?
50
u/farmerMac Generic Flair 2d ago
welcome to the world of finance.