I bought an iPhone 4 from a friend in November, and it was working 100% fine. The water damage indicator was red, but it still worked perfectly fine without any problems. Well, three days ago I dropped my phone and the screen suffered some minor cracks, but it didn't shatter or anything too serious. Well, today, the bottom half of my phone suddenly started flashing and being discolored. I've turned it off and on about 3 times and it's still the same. It flashes then it'll stop flashing but stay discolored, then it'll flash again. It's unlocked, and I paid $250 for it! I saved up for a year and a half (i'm only 16) for that iPhone, and now it's completely tweaking out! My friend bought a refurbished, unlocked iPhone (and her warrenty was up) and they exchanged it and gave her a new one. She told me to just go back and say there's water damage. Problem is, my warrenty is up, and I was always under the impression Apple didn't take anything back with water damage. I'm completely freaking out and have no idea what to do. I can't afford to wait another year to save up to get a decent phone. Someone please help me?