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What you need to know about Sprint's and T-Mobile's iPhone lease deals

Sprint and T-Mobile each announce what look like incredibly cheap pricing for the new iPhone 6S and 6S Plus. What's the catch?

Sprint and T-Mobile have been working overtime to one up each other with what looks like rock-bottom prices for Apple's new iPhone 6S and iPhone 6S Plus, which go on sale today. But are these deals too good to be true?

On Wednesday, T-Mobile announced a promotion that would allow customers on its Jump On Demand leasing program to get a new iPhone 6S with 16GB of storage for $5 a month. Sprint came back on Thursday for a similar deal for just $1 a month.

The new deals are part of an ongoing marketing war among wireless operators vying for new customers at a time when the companies are abandoning subscriber contracts and smartphone subsidies in favor of charging customers a handset's full cost. Leasing programs, like the ones from Sprint, T-Mobile and even Apple, give consumers the opportunity to upgrade their devices more frequently without putting up a lot of cash upfront.

In this edition of Ask Maggie, I burrow into the fine print to help readers understand whether these are good deals for them.

Rock-bottom prices are only available when you trade in an iPhone 6 or a similarly valued device.

Sprint and T-Mobile are not offering customers these jaw-dropping low monthly prices on phones without getting something in return. T-Mobile customers can get the $5 per month promotion if they trade in an iPhone 6 or an iPhone 6 Plus. The same promotion applies to popular Samsung Galaxy devices, like the Samsung Galaxy S6, Galaxy S6 Edge, Galaxy Note 5 or Galaxy S6 Edge +. The value of that trade-in combined with a $7 per month promotional credit, brings the cost of a new iPhone 6S to no more than $5 per month.

iPhone 6S Sarah Tew/CNET

Sprint customers must trade in an iPhone 6 or iPhone 6 Plus for its $1-a-month promotion. Devices from other phone manufacturers will not qualify for this low price. But it is giving a special price to iPhone 5S customers willing to trade in their phone. For those customers, Sprint will offer a $10-per-month promotion on a new iPhone 6S with 16GB of storage or $14 a month for an iPhone 6S Plus with 16GB. Sprint is also offering a promotion through December 31 that allows existing or new customers to trade in any other smartphone and get an iPhone 6S for $15 a month. Typically, the lease price is $22 a month.

The iPhone 6 you're trading in must be paid in full.

To qualify for the promotional prices, customers must own the devices they trade in. This will likely limit the number of people who will qualify for these programs because the iPhone 6 was only released a year ago. Anyone who financed that device is likely to have paid off half only the cost by now. Customers could pay the balance and trade it in, but financially this might not work in their favor since customers who own their phones could also sell the device for more than the trade-in value offered by the carrier.

The deals will expire.

For both Sprint and T-Mobile customers who sign up for these leasing programs, the $1 and $5 a month they pay for their new iPhone 6S will last the duration of their leases. After the 21-month lease period ends, Sprint's price will go up to $22 a month. For T-Mobile customers, the $5 a month price will continue for as long as the customer owns his iPhone 6S, regardless of whether the 18-month lease has expired. But once that customer upgrades to another phone, which he or she is free to do three times in 18 months, the price for the lease may go up.

The bottom line: Are these good deals?

The promotions that Sprint and T-Mobile have put together certainly look attractive. And if you plan to upgrade to a new device every year, this could be a good option for you. But before making a commitment, look closely at the value of the device you're trading in and how much you would pay each month for the new phone.

If you add these two things together, it usually equals the device's retail price. If the trade-in value of your old phone is fairly high, you may be paying more than the retail value of the new iPhone 6S. You may also find a better deal selling your phone through a third-party reseller like Gazelle or eBay than trading in the device.

So no matter which way you plan to pay for your new iPhone, you will likely pay the full retail price one way or another. The only exception: If you actually buy your device from T-Mobile, which is the only US carrier subsidizing the new iPhone 6S, you will pay $125 less than the retail price found elsewhere.

Ask Maggie is an advice column that answers readers' wireless and broadband questions. If you have a question, I'd love to hear from you. Please send me an e-mail at maggie dot reardon at cbs dot com. And please put "Ask Maggie" in the subject header. You can also follow me on Facebook on my Ask Maggie page.