How I Unlocked My iPhone and Lived to Tell About It

Now that my 2 year contract is up I am thinking about what to do with my old iPhone once I get my next replacement. One of the biggest issues I need to address is unlocking it. An unlocked iPhone is worth more when selling it on the secondary market and also makes it possible to use it on a discount cellular carrier.

Before the US Congress passed the Unlocking Consumer Choice and Wireless Competition Act you typically had to find some way to hack your device to ‘Unlock’ it or to pay someone to do it for you. Not anymore. Every carrier, by law, offers a way to do it for free.

What does it mean when your iPhone is ‘locked’?

When I purchased my iPhone 5 in 2013 I signed a new 2 year contract with AT&T. As a frugal home inspector, that way I would get the new handset for $199 instead of paying full price.

AT&T was happy because I would need to pay a little more in each of the 24 months and there would be a penalty if I broke the contract. That would more than make up for the big discount they gave me when I bought it. I was happy because I was certain I would stay with AT&T and did not have to pay full price.

That was all fine and good but AT&T does not trust me. They ‘lock’ my iPhone to only use AT&T for cellular and LTE service. If I was to quit paying my monthly bill and try to use a discount GSM provider my iPhone would not be able to connect to it. It would be ‘locked’ into only using AT&T or using nothing at all.

How can home inspectors go about unlocking your iPhone?

Just because you have completed a 2 year contract your iPhone does not get automatically unlocked. You have to ask AT&T to unlock it for you. The process was amazingly simple and also FREE.

The first step was to go to this page and fill out the request. You will need a few pieces of information such as the IMEI number of your device and possibly the last four digits of the account holder’s SSN. Since my iPhone was on a business account I needed to use this page. Once I filled out the info I waited.

In less than 48 hours I received an email with the title AT&T Device Unlock Request – Complete. In the body of the email was a link to the step by step instructions how to complete the unlock procedure.

The second step of the process was to plug my iPhone into iTunes on my computer and do a Factory Restore. Just to make sure, I backed up my iPhone with iTunes to my local computer so I could restore all my apps and settings once the Factory Restore was complete. Once that was complete I started the Factory Restore. This downloaded new firmware from Apple and once it was installed iTunes told me my iPhone was now Unlocked. Success !!

Once I restored the backup I just did, my iPhone was exactly like it was before except it was now ‘Unlocked’. My iPhone 5 was now free to change carriers and just increased in value.

So what exactly happens when you unlock an iPhone?

At the simplest level, when you ask AT&T to unlock your iPhone, they tell Apple to ‘whitelist’ your specific device. Once that is done Apple can update the firmware on your iPhone with the ‘Unlocked’ version of the iPhone firmware that you install via iTunes.

You can now buy an ‘Unlocked’ iPhone from Apple and avoid all this but you will need to pay full price. I hope to cover that process in another post.

Is a 2 Year Cellular Contract Cheaper than Pay As You Go?

Hopefully you have been following this series of posts describing my journey of purchasing a new iPhone. As a home inspector, the iPhone is an invaluable tool, especially with the Tap Inspect app.

This time I want to focus on the cost of actually purchasing the hardware or as the cellular industry calls it, the handset. Traditionally there have been two ways to get your hands on a new handset. Sign a new 2 year contact or purchase the handset outright. The idea of purchasing the hardware outright is a fairly new option. The cost of the hardware was hidden inside the cost for monthly service over the 24 months of the contract.

It was not long ago that your only option for cellular service was to have a contract and the cost of the handset was minimal or even free. The only time anyone noticed the actual cost was if you lost it or your device broke. Then it was total sticker shock when you realized your flip phone or BlackBerry cost almost as much as a laptop computer.

The situation is different today. Every carrier offers a pay as you go service plan so there is no need to sign a 2 year cellular service contract if you do not want to. You can even hop from provider to provider chasing the best deals as long as your device is compatible with their network like I described here.

To make things even more complicated each carrier is now offering some type of early upgrade plan like AT&T Next and Verizon Edge. They seem to be moving more and more away from the 2 year contract and instead financing the handset with monthly installments.

So, home inspectors, what are the costs?

To determine the total costs we need to add the cost of the hardware to the cost of service. We will use a 16 Gb iPhone 6 and a plan that provides unlimited voice and text with 3 Gb of LTE data over the course of 24 months using AT&T. Verizon should be similar.

Option 1: 2 Year contact

Cost of handset: $199
Cost of Service: $1920
Total Cost: $2119

Option 2: Full purchase of hardware

Cost of handset: $649
Cost of Service: $1560
Total Cost: $2209

Option 3: AT&T Next Plan

Cost of handset: $649
Cost of Service: $1560
Total Cost: $2209

So, home inspectors, it looks like the best choice really depends on your future plans. Keep in mind that with options 1 and 3, your carrier will only give you a handset that is compatible with their network. You will not be able to take it from CDMA to GSM or vice versa.

You can save almost $100 over 2 years if you commit to a a 2 year contract. If you plan to stay with your carrier and want to upgrade your device as soon as possible when a new one comes out you would want to the AT&T Next plan or the Verizon Edge.

Since my plan was to stay with AT&T for at least the next 2 years but hand my device down and possibly use it on a different network option 2 works for me.

I will bring my own handset to AT&T that I purchase for full price from Apple and is CDMA and GSM compatible. The flexibility in the future is well worth and extra $100 over 2 years.