T-Mobile announces "Nothing," allowing the purchase of a new phone for $0 down
T-Mobile announces a change in how new and existing customers finance their new phone purchases.
T-Mobile announces "Nothing" | Image by PhoneArena
Today marks a very important day for T-Mobile subscribers. Starting today, any new phone or other gear financed through a T-Mobile EIP (Equipment Installment Plan) will join Verizon and AT&T in extending 36-month financing for new devices. Previously, T-Mobile remained the only one of the US Big 3 carriers to offer 24-month financing for equipment.
T-Mobile is calling this "Nothing," and it allows well-qualified customers to upgrade to a new phone without having to pay anything out of pocket upfront. For example, with EIP Flex 36, part of T-Mobile's "Nothing," a customer can add taxes and fees into the amount being financed.
With T-Mobile's "Nothing" plan, a new phone can cost you $0 upfront
While other carriers require that you shell out to pay the taxes and fees at the time of the purchase of your new phone, "Nothing" is the only option in wireless allowing you to finance taxes and fees over 36 months. The bottom line is that you pay $0 upfront for a new handset.
T-Mobile's standard financing contract is now called EIP Standard 36. With this 0% APR plan now running for 36 months instead of 24 months, monthly payments will be lower. A $1,200 phone financed over 24 months is $50 a month. Over 36 months, the payment would be $33.33 per month.
To understand what is happening, let's go back to the old days when carriers sold you subsidized phones by locking you into two-year contracts. If you broke the contract and switched carriers, you would pay an Early Termination Fee (ETF).
T-Mobile was the first carrier to end subsidized two-year contracts for new phones
When an uproar started over two-year subsidized contracts, T-Mobile was the first to start offering EIPs in lieu of 2-year pacts and it became the "Un-carrier 1.0 initiative." Fairly quickly, the other carriers started offering financing plans of their own. These plans locked you into two years of monthly payments and then became three years for Verizon, and AT&T customers.
Many aspects of the financing plans resembled subsidized contracts. If you leave your carrier before paying off your phone, you must pay off the remaining balance you owe on the phone.
With T-Mobile moving to 36-month financing plans today, it loses one very important thing that differentiated T-Mobile from its rivals. Reps were on a call today to discuss the change and one summed up the change on Reddit by saying, "rip uncarrier officially."
Longer 36-month financing means lower monthly payments
As we already pointed out, the longer financing plans mean monthly payments will be lower. On the other hand, if you see a hot new phone you want to upgrade to after two years like you used to do, you'll have to pay off the remaining balance of what is owed on the financed phone before you can buy and finance a new device.
T-Mobile is also offering students the opportunity to open their own wireless account for only $30 a month with AutoPay, plus taxes and fees. This is a 40% savings over a single-line plan from Verizon and AT&T. And just in time for the start of the new school year, there is also a student-exclusive 5G Home Internet bundle that gives you a virtual prepaid card with a valuation of up to $200.
T-Mobile says that the upfront costs of switching carriers can be more than $120 per line. That is nearly $500 for a family of four.
Here are T-Mobile's new plans
The carrier says that customers can upgrade to the new Experience 2.0 and Essentials 2.0 plans. They come with the same industry-leading perks and now include the addition of new EIP Flex 36 and EIP Standard 36 device financing options as well. These plans include:
- Essentials 2.0 — Unlimited talk and text, 50GB of premium data, and the industry leading T‑Mobile Tuesdays rewards program.
- Experience More 2.0 — Everything offered in Essentials 2.0, plus unlimited premium data, high-speed data in more than 215 countries, mobile hotspot, Netflix on Us, $3 per month Apple TV, and a 5-year price guarantee.
- Experience Beyond 2.0 — Everything in Experience More 2.0, plus T-Satellite connectivity, free streaming services such as Hulu, Netflix, and MLB.TV on Us, Apple TV for just $3/month, $5 connected device add-ons and more. Customers who switch to Experience Beyond 2.0 can save as much as $750 in the first year.
But for now, T-Mobile's new and existing customers have the opportunity to buy a new phone while paying $0 upfront.
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