If you want to purchase a new phone on the tab then the old one needs to be fully paid off.

You can use the trade in value of your current phone to help cover/offset the pay off though.

So the trade in value basically just pays for the rest of the phone? 

The trade in value would be assessed and you could then use that money to pay what’s remaining or a portion of it.

The value of the trade in may or may not pay for the full amount owing on the phone though. Depends on the value of the phone and what’s left owing on it.