In this video, I show you how to factory reset (aka hard reset, master reset) your Windows Phone 7. Doing a factory reset is great for when your phone is having software related problems as it restores the phone to its original state when there were no problems. Another thing hard resets are useful for are when you want to sell your old phone and want to wipe all your personal information off of it.
To do this, go to the Windows Phone settings. Go to about, then scroll to the bottom and tap on “reset your phone” and confirm the warning. This will wipe your phone clean. Warning: Doing a factory reset erases EVERYTHING off of your phone. Make sure you back up everything you want before proceeding.
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How To Factory Reset Your Windows Phone