How Apple Upgrade Works: Klarna Lease Costs, the 14-Day Return, Early Exit
Apple's lease program: you never own the phone, leaving after 14 days means paying every remaining month, and Chase, Citi, and Amex cards are not accepted. The FAQ, quoted.
The cheapest monthly number on Apple’s iPhone 18 Pro page is not the installment plan. It is Apple Upgrade, the lease that starts at $34.99 a month, and its page opens with the phrase that explains the price: “Love it. Lease it. Upgrade it.” Apple’s own footnote is more precise: “This offer is for a consumer lease, not a purchase or loan.” That single sentence changes every rule that follows. You never own the device, a change of mind after 14 days costs every remaining month, a damaged return carries a fee set by Klarna, and several major credit cards cannot be used to pay. With pre-orders open and the program replacing the old iPhone Upgrade Program, here is what the page and its FAQ say, read on September 13, 2026.
The quick answer
- It is a lease from Klarna, not a loan from Apple. “Leases are provided by Klarna; subject to eligibility and credit approval, including final approval at checkout”
- Terms: “a 12 or 24 month lease for iPhone and Apple Watch,” “a 24 or 36 month lease for iPad and Mac.” No down payment is allowed: “No, you cannot add a down payment”
- What it costs for the new phones: iPhone 18 Pro “from $34.99/mo. for 24 mo. or from $49.99/mo. for 12 mo.”; iPhone Duo “from $57.99/mo. for 24 mo. or from $82.99/mo. for 12 mo.”; iPhone Air from $31.99; iPhone 17 from $25.99; iPhone 17e from $19.99, all on 24 months
- You do not own it at the end. “No, you do not. You must return your device in good working condition at the end of your lease term”
- Changing your mind has a 14-day window, counted from delivery: return the device “in good working condition” and “your lease will be cancelled.” After that, you must “return your device in good working condition and pay the total of your unpaid monthly lease payments”
- Leaving early or upgrading early costs the balance: “the full amount of your remaining lease payments plus applicable taxes”
- Payment restrictions: Klarna does not accept “AMEX and UnionPay” networks or the issuers “Chase, Capital One, and Citibank”; “Apple Pay and PayPal are not accepted for Apple Upgrade”
Key facts at a glance
| Question | What Apple’s page says |
|---|---|
| Who is the lender? | Klarna Inc.; approval “is based on creditworthiness” |
| When is the first payment? | ”Approximately 30 days after device is shipped or available for pickup” |
| Are there fees? | ”No fees associated with your monthly lease payment,” but a damage fee applies if the device is not returned in good condition |
| Can I lease an iPhone without a carrier? | No: “you’ll need to connect to AT&T, T-Mobile, or Verizon,” and “you cannot use a prepaid carrier plan.” iPad, Mac, and Watch need no carrier |
| Is AppleCare included? | ”No, AppleCare coverage is not included,” and you have “up to 60 days after you enroll” to add it |
| What if I return it after 14 days? | Return it and pay “the total of your unpaid monthly lease payments, plus applicable taxes, through the end of the initial lease term” |
| What if I upgrade at 21 months of 24? | ”You’ll pay the remaining three monthly payments plus applicable taxes” |
| Can I buy it outright? | Yes: pay “the list price of the device plus applicable taxes at lease signing less the sum of lease payments you’ve already made and any remaining trade-in credits, through the Klarna app” |
| Will I pay more than the device costs? | ”If you return your device in good working condition, you will not pay more than the full price of the device” |
| Lost or stolen without AppleCare? | Pay “the full price of the device at lease signing less the sum of lease payments you’ve already made” |
| Order not picked up in 7 days? | ”Your lease will be cancelled, and any associated charges would be refunded” |
| Trade-in? | Applied “by Klarna across your payments for the length of your initial lease term”; “you cannot trade-in a device when you upgrade” |
What the monthly number actually buys
The lease footnote gives a worked example that anchors the math: “For an iPhone 18 Pro 256GB with a purchase price of $1199 (excluding taxes and any trade-in credit), the typical monthly payment is $34.99 (excluding taxes and any trade-in credit) for a 24-month lease term and $49.99” for 12 months. Twenty-four payments of $34.99 come to $839.76, which is why Apple can promise that “if you return your device in good working condition, you will not pay more than the full price of the device.” The difference between $839.76 and $1,199 is the phone’s residual value, and it stays with Klarna because the phone goes back.
That is the trade. Installments spread the full $1,199 and leave you with a phone; the lease charges about 70 percent over two years and leaves you with nothing to sell or trade. The FAQ spells out the ownership answer without hedging: “Do I own my device at the end of my lease term? No, you do not.”
Pricing is per device and per term. The 12-month options run higher per month because the residual is lower: $49.99 for the 18 Pro, $82.99 for the Duo. Apple lists the lease on the same product pages as the installment and full-price options, which is why the three numbers are easy to confuse at checkout; the launch prices for all three are in our sister site’s pre-order guide.
The three exits, and what each costs
Apple’s FAQ answers “how much will it cost to upgrade, leave the program, or buy the leased device” in three parts, and the arithmetic is the same in all three: the remaining months are owed.
Upgrade. “There is no additional cost to upgrade at the end of your term. If you upgrade before the end of your term, you will pay the full amount of your remaining lease payments plus applicable taxes. For example, if you upgrade after 21 months on a 24 month lease, you’ll pay the remaining three monthly payments plus applicable taxes.” Upgrading also means “entering into a new lease,” which is “subject to eligibility and credit approval” again.
Leave. “When you reach the end of your lease term and return the device, there is no cost to you to leave the program. But if you decide to end your lease earlier, you’ll need to pay the full amount of your remaining lease payments plus applicable taxes.”
Buy. “If you’d like to keep your device, you can choose to pay the list price of the device plus applicable taxes at lease signing less the sum of lease payments you’ve already made and any remaining trade-in credits, through the Klarna app.” At 24 months on the 18 Pro example, that is $1,199 minus $839.76 paid, about $359 plus tax, which lands you at full price for a two-year-old phone.
In every case the device must come back “in good working condition to avoid any damage fees.” The return itself uses “the prepaid return kit we provide,” or a drop-off “at an Apple Store.”
The 14-day change-of-mind rule
This is the clause to read before the phone arrives. “If you change your mind after you enroll in Apple Upgrade, you have 14 days after receiving your device to return your device back to us in good working condition. After we receive your device, your lease will be cancelled.” That mirrors Apple’s normal return window and costs nothing beyond returning the device intact.
Day 15 is a different contract: “After 14 days, you will have to return your device in good working condition and pay the total of your unpaid monthly lease payments, plus applicable taxes, through the end of the initial lease term.” There is no partial credit for early return. A 24-month lease returned in month three is billed for 21 months, and Apple’s page does not describe any hardship exception.
A separate rule covers an order that never starts: “If you don’t pick up your Apple Upgrade device within 7 days of placing your order, your lease will be cancelled, and any associated charges would be refunded.”
Damage, loss, and why AppleCare is the quiet second subscription
The lease price includes no protection, and the page repeats that from two angles. “AppleCare coverage is not included with your Apple Upgrade lease. If you choose to purchase AppleCare protection, it will be billed separately from your lease by Apple.” And the damage consequence without it: “If you don’t have AppleCare coverage and your device is not returned in good working condition, Klarna will charge you a one-time damage fee. You can repair your device before you return it to avoid this fee.” The fee amount is not published on the page.
Loss is the expensive case. “If you don’t have AppleCare+ Theft and Loss coverage… and your device is stolen or lost, you’ll need to pay the full price of the device at lease signing less the sum of lease payments you’ve already made, plus applicable taxes, to purchase the device.” Lose an 18 Pro in month two and you owe roughly $1,129 for a phone you no longer have. Worse, inaction compounds it: “If you take no action, Klarna will continue to charge you your monthly lease payment through the extension period, and then you will be charged to purchase the device through Klarna.”
Which is why Apple’s advice reads the way it does: “Add AppleCare coverage when you enroll, and your return will be much easier.” The window is “up to 60 days after you enroll,” or you “can add your leased device to your AppleCare One subscription.” What each AppleCare tier costs and cancels, including the new Family plan launching September 14, is in our AppleCare One Family guide.
The trade-in interaction
Apple Trade In works differently under a lease, and the difference is in who applies the credit. “When you first enroll in Apple Upgrade, you can trade in an eligible device you own to lower your monthly payments for your initial lease term. Your trade-in credit will be applied by Klarna across your payments for the length of your initial lease term.” So an $885 credit on a 24-month lease shows up as about $36.88 off each month rather than as a lump sum.
Two consequences follow. The credit is conditional on inspection, as with any Apple trade-in: “If your trade-in isn’t returned or isn’t in good working condition, your monthly lease payment will be updated by Klarna to reflect the adjusted value.” And it is a one-time benefit: “Your trade-in credit will only apply to your initial lease term. You cannot trade-in a device when you upgrade.” The inspection rules, revised offers, and the 14-day trade-in clock are in our Apple Trade In guide.
Who cannot pay, and who cannot enroll
The payment restrictions are unusual enough to check before pre-ordering. “You can use all debit cards and select major credit cards for your Klarna payments. However, some card networks, like AMEX and UnionPay, and some card issuers, like Chase, Capital One, and Citibank, are not accepted by Klarna.” Apple takes those cards for AppleCare and accessories, but “Apple Pay and PayPal are not accepted for Apple Upgrade.” Payments are managed “through the Klarna app,” not through Apple, so an unfamiliar Klarna line on a statement is this program; our unrecognized charge guide covers the Apple-side charges that sit alongside it.
Eligibility, from the footnote: “a U.S. resident, at least 18 years old (or the legal age in your state), have an accepted credit or debit card, and have an Apple ID,” excluding U.S. territories. The program “is not available on refurbished devices” or through employee, corporate, business, government, education, or military purchase programs. And the lease is a credit product: “Lease approval is subject to eligibility and is based on creditworthiness.”
For anyone still on the old iPhone Upgrade Program, Apple’s page states plainly that “the program is coming to an end,” with a sign-in path to see the options for moving over.
Bottom line
Apple Upgrade turns an iPhone into a two-year rental at roughly 70 percent of its price, with Klarna as the lender, no down payment allowed, and no ownership at the end unless you pay the difference. It is cheap month to month and expensive to leave: after the 14-day return window, every remaining payment is owed on exit, upgrade, or early return, and a lost phone without AppleCare costs nearly its full price. Before enrolling, confirm the card you plan to use is one Klarna accepts, decide on AppleCare within 60 days, and treat the trade-in as a monthly discount that can be revised after inspection.
All quotes from Apple’s Apple Upgrade page, its FAQ, and its lease footnotes, read on September 13, 2026, with launch pricing from Apple’s September 9 press release. Lease terms are set at checkout by Klarna; the agreement you sign is the one that applies.