Phone for Cash Deals: Are They Safe?

Lately, companies that let you trade your old cell phone for cash have gotten a lot of media attention. But should you take advantage of their offers?

In recent months, you may have seen so-called “phone for cash” companies featured in the media and thought, “Hmmm, that might be a way to make a little money to put toward Junior’s orthodontia.” Basically, these organizations offer to pay you cash for your old cell phones, if you’ll just send them in.

But not so fast. Like so many similar schemes, it’s too good to be true — mostly.

The First Clue

The fact that you have to send in your phone first should trip you up right away. This requirement is understandable, but consider this: when you buy from a merchant online or via mail order, don’t you have to send the payment before you get the goods?

Occasionally someone will let you try something free for a little while, but that’s rare. Most companies want their money up front…and even then, you usually have purchase protection or can dispute the charges with your credit card company if you don’t get what you paid for.

But like most companies preying on the hard-up in these tough economic times, these guys want the goods before they pay a cent.

Well, So?

So there’s no guarantee they’ll ever pay you anything, and if they do, they may not pay what they promised. These companies are notorious for bait-and-switch tactics in which they offer a certain amount for a phone, and then make a second and lower offer when they receive it.

And what recourse do you have? They already have your phone. They don’t have to send it back.

Admittedly, in some cases the phones are in poorer condition than claimed, which legitimizes their re-offers. But apparently this is regular practice, given the thousands of complaints registered online. Sometimes payment never comes, and attempts at communication with the companies fail repeatedly.

The biggest problem is that this industry is poorly regulated at the moment, so they can get away with a lot.

And Another Thing…

Unless you’re a real techno-junkie, you won’t make much money on your phone; even most of the nicer iPhone clones will earn you only $30-40, with the best phones bringing a bit over $100. And these are the top-of-the-line bought-yesterday phones that cost $500 and up, and are in perfect condition.

On a positive note: they’ll happily do cell phone recycling on all those other models, even if they won’t pay you.

Bottom line: In Your Humble Writer’s opinion, dealing with these companies just isn’t worth the effort. At best, they’re easy places to recycle your old phones; otherwise, don’t expect the exchange to be profitable… for you. Too many phone for cash companies are too willing to cheat, and their offers are ridiculously low.