Is it legal to sell phones that are on contract?

Is it legal to sell phones that are still under contract?
In one of my hair-brained schemes, I'm thinking I could take out a contract, sell the phone, and treat it as a low-interest loan with payments over two years. Stupid idea? ;)

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matt101101 / MOD  Nov. 27, 2013 at 17:57

Plenty of people do it, usually with unwanted upgrades though.

Technically, the phone still belongs to the network until you've made your final payment at the end of the two years. As long as you don't default on paying off the contract, the network won't care that you've sold the phone. If you're that desperate for a couple of hundred quid in cash though, I have my suspicions you may well end up defaulting before the two years is up, at which point things may get...erm...interesting.

Also, you need to find a contract which the total cost is only slightly more than how much you would make from selling the phone. That in itself might prove more difficult than it sounds. The phone you sell also needs to be worth a lot to make the whole plan worth it, there's no point going to all that effort to end up with what would in effect be a loan for £50. That limits you to high end phones, which tend to come with expensive, high usage contracts.

In conclusion, your plan could work, but it's likely to be more effort than it's worth. If it all goes balls up, you could well end up in front of a magistrate up against your network...probably not a position you'd like to be in.

AhmadCentral  Nov. 27, 2013 at 19:48

Yes, it's illegal.

Don't do it. My friend Dave sold his contract phone and did 20 years inside. He was a changed man after that experience. Don't make the same mistake he did.

JanSt / MOD  Nov. 27, 2013 at 19:49

Take up a loan from a credit union. They can use the support, and you probably pay less in interest.

tomwatts  Nov. 27, 2013 at 20:04

I did this a while ago with an iPhone contract. No desire to own the iPhone, but I simply sold the iPhone, took the quidco, and paid it off over 24 months. Made £40 and had the money upfront.

kpmatthews  Nov. 27, 2013 at 20:11

assuming uk based, perfectly legal. the contract is only for the sim/ tariff and not connected to the handset. the handset is in effect a gift from the network. it is cheap/free as the network subsidize it, although in reality you end up paying for it over the course of the contract.

if you don't pay the bill for a couple of months and ignore letters, the network will close the account and ask for the remainder of the contract in one go, then eventually sell the debt to a debt collection agency. they never ask for the handset back.

i've done this a couple of times purely to make profit, as i could sell the handset and claim cashback for more than the cost of the contract. if in uk look at e2save and phones4u, they usually give cashback that you claim every 3 months or so. this plus the money you get from selling the handset could take you close to the cost of the contract, then you have a 0 interest loan :)


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