Everything You Need to Know About Financing a Cell Phone

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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
What Is Cell Phone Financing?
How Does Financing a Cell Phone Work?
Pros of Financing a Cell Phone
It can spread out the cost of a large purchase. This is the primary perk of a cell phone financing plan. It lets you avoid making a large payment out of pocket. It can help you build credit. If the creditor reports payments to the three main credit bureaus (double check to make sure they do), you can build your credit score if you consistently make your payments on time.
Cons of Financing a Cell Phone
An application can harm your credit score. Applying for new financing can lead to a hard credit check, which can temporarily lower your credit score. Late payments can result in debt collections. If you fail to make your payments on time, it can damage your credit score. Eventually, your debt could be sent to collections which will hurt your credit even more.
Cell Phone Financing Options
In-Store Financing
Personal Loans
Credit Cards
Manufacturer Financing
Service Provider Financing
Which Cell Phone Financing Option Is Best for You?
The Takeaway
Frequently Asked Questions
Photo credit: iStock/Vectorig
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About the Author
Jacqueline DeMarco is a personal finance writer and editor based in Southern California. While she spends the bulk of her time writing about complex financial issues, she also tackles a variety of subjects ranging from food to fashion to travel. Her work can be found across dozens of publications such as Credit Karma, LendingTree, Northwestern Mutual, The Everygirl, and Apartment Therapy.
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