Buying a cellphone that is under 'contract'

[veedub]

Hi all

Please excuse me if this has been asked previously.

I am looking to purchase an S22 Ultra. There are quite a few for sale on this forum, but they are 'contract' phones.

What are the risks here?

From what I could find online, if the person who took the contract defaults on their payments, then the service provider could block the device.

Additionally, from previous experience, it seems that some networks require you to only use their network sim in the device for the warranty to be valid. Is this still an issue?

Also, what proof of purchase would Samsung require to honor any warranty claims?

Thanking you in advance

 

[ovisser1]

You are correct, If they stop paying the contract, you're out of a phone.
It's high risk for me and I wouldn't personally do it nor recommend doing it. But a lot of people do it, and I have to date only seen 1 bad deals thread because of a contract that was no longer being paid - So its either not something that happens often or no one does it.

I also can't see how they would require you on their network for the warranty to be valid, by using "provider 1" instead of "provider 2" the phone does not get damaged in any way - I would love to be proved wrong, but I don't think its possible, and doesn't sound like something that would be legal either.

 

[Oj0]

You are correct, If they stop paying the contract, you're out of a phone.
It's high risk for me and I wouldn't personally do it nor recommend doing it. But a lot of people do it, and I have to date only seen 1 bad deals thread because of a contract that was no longer being paid - So its either not something that happens often or no one does it.

Rare doesn't mean impossible. SA it at record levels for unemployment. Everything is so volatile and unpredictable that the risk is higher now than ever. Just because you've seen one bad deal thread doesn't mean it isn't more common but the two parties come to an agreement and it never sees light of day on Carb.

I'm not saying this DOES happen, but when shit hits the fan I'm sure a contract for a device you no longer even have is the least of your worries when things such as rent/food are included.

I also can't see how they would require you on their network for the warranty to be valid, by using "provider 1" instead of "provider 2" the phone does not get damaged in any way - I would love to be proved wrong, but I don't think its possible, and doesn't sound like something that would be legal either.

It's in the terms of your contract (I'm one of those people that piss off the sales guys by taking 30 minutes to read every word of a contract before signing). I can't answer whether it's legally enforceable or not.

What I can say is that it's not something that can be sorted out in SCC, (you haven't, for example, paid for a phone and not received it - SCC is generally for black and white cases where there is no question of the money owed to you and no understanding of or interpretation of the law required).

The value of the device is probably too low for anyone to bother going to a higher court especially considering the attorneys normally walk out with more than half of the awarded amount... Assuming you do actually win.

A phone's value that's a bit of a catch 22 situation.

 

[ovisser1]

Rare doesn't mean impossible. SA it at record levels for unemployment. Everything is so volatile and unpredictable that the risk is higher now than ever. Just because you've seen one bad deal thread doesn't mean it isn't more common but the two parties come to an agreement and it never sees light of day on Carb.

I'm not saying this DOES happen, but when shit hits the fan I'm sure a contract for a device you no longer even have is the least of your worries when things such as rent/food are included.

That's why I said I wouldn't recommend it Didn't think of people sweeiping it under the rug for effort/value though. Good point.

It's in the terms of your contract (I'm one of those people that piss off the sales guys by taking 30 minutes to read every word of a contract before signing). I can't answer whether it's legally enforceable or not.

Thank you for this part, I did not know this.
Haven't had a contract in quite a few years, so I have no idea what crap they put in there these days.

 

[Oj0]

That's why I said I wouldn't recommend it Didn't think of people sweeiping it under the rug for effort/value though. Good point.

I've been in that situation - not a phone I sold, but one I was still using. 2020 comes, retrenched. "Well then blacklist or fetch your fking phone, IDFAG. I can't eat it or live in it." I legit said that to Cell C when they kept phoning me for payment. I managed to get back onto my feet before they blacklisted it, but I know plenty of people who've been looking for work since 2020 happened.

Thank you for this part, I did not know this.
Haven't had a contract in quite a few years, so I have no idea what crap they put in there these days.

With my last contract (late 2018) I was in a hurry and didn't want them to open the phone. They said they have to as well as insert the sim card for warranty. My middle kid also had warranty void on a tablet late 2020 for putting a Rain sim card into it (it was a cheap as chips tablet that was given to him so /care, but it does happen).

 

[solz]

the other side of this is that some people buy the phone's on contract as you tend to be buying the phone with no interest.
also some network providers allow you to upgrade a few months early.
then they sell the device for cash as they might still be happy with their old device and just want cash without taking out a loan as their is no interest on the phone. (I was once offered an upgrade almost 6month early by mtn a few years back but this was also according to them from high usage on the contract I was on back then so was almost always using out of bundle data and airtime) - but now they don't offer me that as I'm almost on the cheapest package and set a limit on the usage.

 

[Oj0]

the other side of this is that some people buy the phone's on contract as you tend to be buying the phone with no interest.
also some network providers allow you to upgrade a few months early.
then they sell the device for cash as they might still be happy with their old device and just want cash without taking out a loan as their is no interest on the phone. (I was once offered an upgrade almost 6month early by mtn a few years back but this was also according to them from high usage on the contract I was on back then so was almost always using out of bundle data and airtime) - but now they don't offer me that as I'm almost on the cheapest package and set a limit on the usage.

Yes, and that phone is surety against said "loan" - which is where it becomes risky. If a stranger wants a loan, are you comfortable standing surety for them, which is essentially what you're doing by buying the device? Needing a loan means potential financial difficulty to start with.

 

[Antioxide]

The S22 ultra is actually cheaper to purchase through say Telkom.

Its R699 per month for 36 months = R25164 (2gb data 500mb steaming 500mb WhatsApp 1000 Telkom to Telkom minutes 100 all network minutes

The next step you can purchase an old S10E off someone as long as it turns on without the charger plugged in.

Then the trade in deal (R10 000 guarantee with trade in of old devices on the list) = R25164 - R10000 = R15164

If you are lucky enough to get buds pro with it. that's another 1500 -2000 off that price if you sell it.

 

[JoE]

My experience with buying contract phones off gumtree and the like is that most times they are corporate devices ie. work phones so that's probably why there's not so many bad threads about them. All warnings still apply though as that's a risk you willingly take and must accept it if it doesn't work out.

Regarding the warranty issue, I know for a fact that's how vodacom operates because I once had a vodacom contract phone but I was on MTN... used to put in a vodacom sim for a few days so it registers on the network and the warranty appears on the system again. Other operators generally either want the proof of purchase or the original contract holder present which can also be an issue to consider.

 

[solz]

Yes, and that phone is surety against said "loan" - which is where it becomes risky. If a stranger wants a loan, are you comfortable standing surety for them, which is essentially what you're doing by buying the device? Needing a loan means potential financial difficulty to start with.

sure there is risk but not always the case. my brother has done this also in the past as he was happy with his nokia think was lumia 920.
so he ended up getting the best iPhone's on his 3 contracts and used the cash to build a flatlet that he rented out that ended up paying way more back then what he was paying for the contracts.

but think risk also depends how long the guy's been with the provider, but anything can change not just in SA, world wide as covid has hit every part of the world hard and this russian kota is also not helping anyone, maybe those selling oil

 

[Oj0]

sure there is risk but not always the case. my brother has done this also in the past as he was happy with his nokia think was lumia 920.
so he ended up getting the best iPhone's on his 3 contracts and used the cash to build a flatlet that he rented out that ended up paying way more back then what he was paying for the contracts.

Even that carries risk, what if he couldn't find tenants/tenants didn't pay/unexpected expenses arise (a geyser bursts and he as landlord has to cover damages)/etc? Had any of that happened, would the phone contracts have been given priority? If so, what if he wasn't in a position to give them priority?

but think risk also depends how long the guy's been with the provider,

I was with Cell C for more than 10 years before defaulting for a month. I had a credit score of nearly 660 at the time. My wife had been with Cell C for nearly 14 years and also had to default that month as I couldn't contribute towards household expenses.

but anything can change not just in SA, world wide as covid has hit every part of the world hard and this russian kota is also not helping anyone, maybe those selling oil

Exactly this.

 

[thePridge]

Technically the device actually belongs to the provider until the end of the contract term OR the customer pays the balance of the device cost. There's probably fine print deep in the T's & C's saying this is not allowed.

This is basically the same situation as financing a car through wesbank and then someone else buys it, but wesbank hasn't been settled.

 

[veedub]

Thank you all for the replies.

Maybe in the days when a phone was R5k, it was an acceptable risk, but now at R20k, not so much.

I will rather wait for someone to have a 'cash' phone up for sale or wait for specials with Samsung/Cell C

 

[ThatPCGuy]

Hi all

Please excuse me if this has been asked previously.

I am looking to purchase an S22 Ultra. There are quite a few for sale on this forum, but they are 'contract' phones.

What are the risks here?

From what I could find online, if the person who took the contract defaults on their payments, then the service provider could block the device.

Additionally, from previous experience, it seems that some networks require you to only use their network sim in the device for the warranty to be valid. Is this still an issue?

Also, what proof of purchase would Samsung require to honor any warranty claims?

Thanking you in advance

Many many years ago, a younger me bought an iPhone 8 on contract. Wasn't a question I thought about, back then.

A year down the line, the phone was blacklisted because the guy faulted on his payments. He told me he was going to pay it soon, the day never came.

Don't touch a contract phone with a long stick, it isn't worth the risk.

 

[Oj0]

Many many years ago, a younger me bought an iPhone 8 on contract. Wasn't a question I thought about, back then.

A year down the line, the phone was blacklisted because the guy faulted on his payments. He told me he was going to pay it soon, the day never came.

Don't touch a contract phone with a long stick, it isn't worth the risk.

You must be quite young if you think that within the last 4.5 years you were younger. I feel like I was expired milk back then already.

 

[ThatGuyJD]

You must be quite young if you think that within the last 4.5 years you were younger. I feel like I was expired milk back then already.

That's the results of years of hardcore drinking that makes you feel that way.

 

[mikewazar]

Thank you all for the replies.

Maybe in the days when a phone was R5k, it was an acceptable risk, but now at R20k, not so much.

I will rather wait for someone to have a 'cash' phone up for sale or wait for specials with Samsung/Cell C

@LaserEldo may be able to assist with cash phones.