Apple Upgrade Terms Guide

By Manish Shankar

Latest update – 8 October 2026: Apple has ended new enrollment in the US iPhone Upgrade Program and introduced Apple Upgrade, a separate lease offered through Klarna. Existing iPhone Upgrade Program members do not need to act immediately: their Citizens One loan and AppleCare coverage continue while the account remains in good standing.

The practical difference is ownership. The former iPhone Upgrade Program used a 24-month installment loan and let eligible members trade in after the equivalent of 12 payments. Apple Upgrade is a lease: the customer normally returns the device at the end of the selected term, starts a new lease to upgrade, or pays the purchase option if they want to keep it.

Apple Upgrade and the old iPhone Upgrade Program compared

Feature	iPhone Upgrade Program	Apple Upgrade
Status in the United States	Ending for new purchases; existing loans continue	Available for eligible products
Contract	24-month 0% APR installment loan through Citizens One	Lease through Klarna
Products	Eligible iPhone models	Eligible iPhone, iPad, Mac and Apple Watch models
Typical term	24 months	12 or 24 months for iPhone and Apple Watch; 24 or 36 months for iPad and Mac, subject to product availability
Protection	AppleCare+ was part of the financed package	AppleCare can be added; it is not described by Apple as automatically included
At the end	After 24 payments, the loan closes and the iPhone is yours	Return the device, start a new lease, or use the purchase option

What happens to existing iPhone Upgrade Program members?

Payments continue: Apple says the existing Citizens One loan remains active. Finishing all 24 payments closes the loan and leaves the customer owning the iPhone.
AppleCare continues: Existing coverage remains active for the full 24-month term if the loan stays in good standing or is paid in full.
An eligible member has choices: Apple lists Apple Upgrade, Apple Card Monthly Installments, carrier financing and an outright purchase as possible routes for the next iPhone.
No automatic conversion: Apple does not say that an old loan silently becomes a new lease. A customer choosing Apple Upgrade applies for a new agreement.

How Apple Upgrade works

Choose an eligible Apple product and an available lease term.
Apply during checkout. Apple says Klarna provides the lease.
Make the monthly payments for the selected term.
At the end, return the device in good working condition and upgrade, return it and leave, or pay the stated purchase amount to keep it.

Apple says an early upgrade is possible, but the customer must pay the remaining scheduled lease payments plus applicable taxes. The replacement device starts a new lease application. A device returned after an upgrade must be in good working condition; damage charges can apply.

So what is the catch?

The headline trade-off is that the lower monthly payment is for use of the device, not automatic ownership. A customer who repeatedly upgrades keeps making payments and keeps returning hardware. Someone who wants to own and keep a device should compare the lease’s total payments and purchase option with an outright purchase, carrier financing and any available installment plan.

The second trade-off is exit cost. Apple says ending the lease early requires the remaining lease payments plus taxes, and the device still has to be returned in good working condition unless the customer exercises the purchase option. Upgrading early uses the same remaining-payment rule.

The third trade-off is condition risk. A damaged return can lead to charges. Adding AppleCare may reduce some repair exposure, but its cost and coverage should be included in the comparison rather than treated as free.

Questions to check before enrolling

Is the quoted monthly amount for a 12-, 24- or 36-month term?
What is the total of all scheduled payments?
What will it cost to buy the device at the end?
What qualifies as good working condition, and what damage fees can apply?
Is AppleCare included, optional or separately billed?
What amount is due if you upgrade or leave early?
Does a trade-in credit reduce every payment or only the initial lease?

Related Herald Express coverage

Primary sources

Source check: 8 October 2026. Availability and financing terms can change; confirm the checkout disclosure that applies to your location and product.

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