"Get the new iPhone on us" sounds like a gift. It is really a payment plan with a condition: stay on an expensive plan for three years. Sometimes that is a good deal. Often an unlocked phone on a cheaper plan costs hundreds of dollars less. Here is how to tell.
How carrier phone deals work
Verizon, AT&T and T-Mobile sell phones on device payment plans, typically over 36 months. When a phone is "free" or heavily discounted, the carrier does not lower the price. It charges you the full price in 36 monthly installments and gives you a matching bill credit each month. The deal usually requires a specific, more expensive plan for the whole period.
Two things follow from that:
- The phone stays locked to the carrier until it is paid off, so you cannot take it to a cheaper plan elsewhere.
- Leaving early costs money. If you cancel, the credits stop and the remaining balance becomes due. On a $900 phone, leaving after 12 of 36 months means you owe about $600.
Do the 36-month math
Compare the total you pay over 36 months, not the monthly price. A simple example for one line:
| Option | Phone | Plan per month | Total over 36 months |
|---|---|---|---|
| "Free" phonerequires a $95/mo plan | $0 | $95 | $3,420 |
| Same phone, unlockedon a $25/mo prepaid plan | $900 | $25 | $1,800 |
Illustration with round numbers, before taxes and fees. Use the real prices from our plan comparison for your own calculation.
In this example the unlocked route saves $1,620, even though you pay for the phone up front. The carrier deal only wins if you would choose that expensive plan anyway for its other benefits, such as priority data, travel data or streaming.
When a carrier deal makes sense
- You already want the carrier's premium plan for coverage, travel or perks.
- You plan to stay with the carrier for the full term.
- The deal stacks with a trade-in you would otherwise sell for less.
When an unlocked phone wins
- You are happy with a budget plan on the network that covers you best.
- You want the freedom to switch whenever a better plan appears.
- You keep phones longer than three years, or buy a previous-generation model at a discount.
Unlocking rules in 2026
If you already have a carrier phone, it can usually be unlocked once paid off. Verizon unlocks postpaid phones automatically when they are paid in full, while its prepaid brands now require 365 days of paid service. AT&T requires the phone to be paid off and active for more than 60 days. T-Mobile unlocks paid-off postpaid phones after 40 days of service. Read more in our guide on switching carriers.
Frequently asked questions
Is a free phone from a carrier really free?
Only if you keep the required plan for the full term, usually 36 months. The phone's price is split into monthly payments, and each payment is canceled by a bill credit. Leave early and the credits stop while the remaining balance comes due.
Where do I buy an unlocked phone?
From the manufacturer (Apple, Samsung, Google), from big retailers, or from marketplaces. Our tech deals page shows live prices for new, unlocked phones from top-rated US sellers.
Will an unlocked phone work on every network?
Recent phones from the big brands work on Verizon, AT&T and T-Mobile. Run the compatibility check on the new carrier's website with your phone's IMEI to be sure.
Facts checked against carrier and provider websites, FCC publications and independent network tests on October 21, 2026. Found something out of date? Let us know.