topic Re: Affirm Installment Loans in General Credit Topics

Affirm Installment Loans

AirPodMax — Wed, 23 Apr 2025 06:59:57 GMT

I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

Re: Affirm Installment Loans

GigaChad_bro — Wed, 23 Apr 2025 10:54:17 GMT

Installment loans from Affirm (especially small or short-term ones) don’t always carry the same weight as traditional loans or credit cards in scoring models. Some bureaus treat them more like consumer finance accounts, which can be a slight negative if overused, mostly because they’re seen as high-risk debt tools

Re: Affirm Installment Loans

citymunky — Wed, 23 Apr 2025 14:43:54 GMT

Did all 25 loans make it too your credit report(s)? I used affirm, but only when it offered 0% APR for 4 installments that didn't report.

Re: Affirm Installment Loans

AirPodMax — Wed, 23 Apr 2025 16:30:07 GMT

@citymunky wrote:
Did all 25 loans make it too your credit report(s)? I used affirm, but only when it offered 0% APR for 4 installments that didn't report.

I believe so, I see a total of 40 accounts on my profile ~28 closed including 25 Affirm loans, a paid off car, paid off student loan, and a Discover card I got when I was 17 that Discover randomly closed about 8 years ago.

Re: Affirm Installment Loans

citymunky — Thu, 24 Apr 2025 04:42:29 GMT

So on one hand you have thick file with alot of positive tradelines reported, but on the other I bet your Average Age of Accounts/Credit Age is not ideal due to amount for loans that only lasted a short amount of time.

Re: Affirm Installment Loans

AirPodMax — Sun, 27 Apr 2025 01:54:39 GMT

@citymunky wrote:
So on one hand you have thick file with alot of positive tradelines reported, but on the other I bet your Average Age of Accounts/Credit Age is not ideal due to amount for loans that only lasted a short amount of time.

Ahh, had not considered this side effect!

Re: Affirm Installment Loans

Lou-natic — Mon, 28 Apr 2025 01:55:09 GMT

@AirPodMax wrote:
@citymunky wrote:
So on one hand you have thick file with alot of positive tradelines reported, but on the other I bet your Average Age of Accounts/Credit Age is not ideal due to amount for loans that only lasted a short amount of time.

Ahh, had not considered this side effect!

I made the mistake of using affirm once to buy a laptop, I have older post about it but basically it hurt me more than it helped and I'm glad they only report to one CRA and not all 3. Even now my EX scores will slightly lag the others because they are reporting a "consumer finance account" that none of the others are. CFAs aren't good for your credit scores. If I'd known then what I know now I would have done it differently. Luckily the account will fall off in just another year or two and I still have great credit anyway but it's in spite of Affirm not because of them.

-edit-

Actually I just checked and I paid the account off Apr. 2018 which means it will report for another 3 years. Ugh.

Re: Affirm Installment Loans

Zoostation1 — Mon, 28 Apr 2025 04:32:09 GMT

@Lou-naticThis kinda highlights what I see as the actual problemm - that the mere presense of a consumer finance account is a negative. While I've never used Affirm, Klarna or any of those services I do take issue with CFA's being treated as an automatic negative regardless of whether they are paid in full per the terms. From my perspective that's a serious flaw in the scoring algorithms.

Re: Affirm Installment Loans

indiolatino61 — Mon, 28 Apr 2025 04:41:23 GMT

@AirPodMax wrote:
I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

I've never used Affirm, but many of my friends and family have. I don't know if this is always true, but many said that only the first loan is reported to credit bureaus. All subsequent ones are not, unless you default. Please correct me if this is in error. In addition, they said their scores went up initially, but then went back down to the original level when the loan was paid. Thanks.

Re: Affirm Installment Loans

indiolatino61 — Mon, 28 Apr 2025 04:53:31 GMT

@Zoostation1 wrote:
@Lou-naticThis kinda highlights what I see as the actual problemm - that the mere presense of a consumer finance account is a negative. While I've never used Affirm, Klarna or any of those services I do take issue with CFA's being treated as an automatic negative regardless of whether they are paid in full per the terms. From my perspective that's a serious flaw in the scoring algorithms.

In general, I must agree with your assessment. Any money you borrow and pay back in a timely manner as agreed, regardless of the source, should be scored positively. It seems risk management algorithms are written in stone, and all involved follow them blindly. As soon as the first lender deemed CFA's "risky," each one followed suit. "Payday loan lenders" were the first "villains." Now, lenders such as Affirm, Klanra, et al are also lumped into the same risk group. In the end, all we can do is what is in our best interest. Good luck to us all.

Re: Affirm Installment Loans

Zoostation1 — Tue, 29 Apr 2025 03:43:39 GMT

Some auto loans financed through the manufacturer have gotten coded as a CFA also.

Re: Affirm Installment Loans

indiolatino61 — Tue, 29 Apr 2025 06:07:44 GMT

@Zoostation1 wrote:
Some auto loans financed through the manufacturer have gotten coded as a CFA also.

Really? Well, that's just absurd. I wonder if that's something a borrower can have changed.

Re: Affirm Installment Loans

Lou-natic — Mon, 05 May 2025 19:47:25 GMT

@indiolatino61 wrote:
@AirPodMax wrote:
I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

I've never used Affirm, but many of my friends and family have. I don't know if this is always true, but many said that only the first loan is reported to credit bureaus. All subsequent ones are not, unless you default. Please correct me if this is in error. In addition, they said their scores went up initially, but then went back down to the original level when the loan was paid. Thanks.

Well here's the deal a little bit of nuance is required.

If you take an affirm loan for say 12 months that is going to get reported but if you take a 0% interest loan that you pay off in one month that won't be reported. Similarly things like zip pay and sezzle do not report to the credit bureaus either. Basically if it's a zero interest one of those make four payments every two weeks kind of deals you're fine but if you take an actual loan and it has interest then it gets reported.

Re: Affirm Installment Loans

indiolatino61 — Tue, 06 May 2025 05:05:35 GMT

@Lou-natic wrote:
@indiolatino61 wrote:
@AirPodMax wrote:
I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

I've never used Affirm, but many of my friends and family have. I don't know if this is always true, but many said that only the first loan is reported to credit bureaus. All subsequent ones are not, unless you default. Please correct me if this is in error. In addition, they said their scores went up initially, but then went back down to the original level when the loan was paid. Thanks.
Well here's the deal a little bit of nuance is required.

If you take an affirm loan for say 12 months that is going to get reported but if you take a 0% interest loan that you pay off in one month that won't be reported. Similarly things like zip pay and sezzle do not report to the credit bureaus either. Basically if it's a zero interest one of those make four payments every two weeks kind of deals you're fine but if you take an actual loan and it has interest then it gets reported.

This is from the Affirm website:

Affirm credit reporting: Plans originated before April 1, 2025

What information does Affirm report to the credit bureau?

Beginning April 1, 2025, all Affirm payment plans and associated repayment activity will be reported to Experian. Additionally, Affirm will begin reporting this information to TransUnion on May 1, 2025, and may report to other credit bureaus in the future. For more information on how plans originated after April 1, 2025, will be reported, click here.

Affirm currently reports some payment plan and repayment activity for plans originated prior to April 1, 2025 to Experian. Typically, your first monthly installment plan with Affirm is reported. After you’ve had at least one plan furnished, Affirm won’t report subsequent plans unless they become 30+ days overdue.

Re: Affirm Installment Loans

Lou-natic — Wed, 07 May 2025 00:46:15 GMT

@indiolatino61 wrote:
@Lou-natic wrote:
@indiolatino61 wrote:
@AirPodMax wrote:
I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

I've never used Affirm, but many of my friends and family have. I don't know if this is always true, but many said that only the first loan is reported to credit bureaus. All subsequent ones are not, unless you default. Please correct me if this is in error. In addition, they said their scores went up initially, but then went back down to the original level when the loan was paid. Thanks.
Well here's the deal a little bit of nuance is required.

If you take an affirm loan for say 12 months that is going to get reported but if you take a 0% interest loan that you pay off in one month that won't be reported. Similarly things like zip pay and sezzle do not report to the credit bureaus either. Basically if it's a zero interest one of those make four payments every two weeks kind of deals you're fine but if you take an actual loan and it has interest then it gets reported.
This is from the Affirm website:
Affirm credit reporting: Plans originated before April 1, 2025
What information does Affirm report to the credit bureau?

Beginning April 1, 2025, all Affirm payment plans and associated repayment activity will be reported to Experian. Additionally, Affirm will begin reporting this information to TransUnion on May 1, 2025, and may report to other credit bureaus in the future. For more information on how plans originated after April 1, 2025, will be reported, click here.

Affirm currently reports some payment plan and repayment activity for plans originated prior to April 1, 2025 to Experian. Typically, your first monthly installment plan with Affirm is reported. After you’ve had at least one plan furnished, Affirm won’t report subsequent plans unless they become 30+ days overdue.

Ouch. Affirm sucked before, this just makes it worse.

Re: Affirm Installment Loans

indiolatino61 — Wed, 07 May 2025 00:51:15 GMT

@Lou-natic wrote:
@indiolatino61 wrote:
@Lou-natic wrote:
@indiolatino61 wrote:
@AirPodMax wrote:
I used to be in a rock band, and we were all absolute slaves to Affirm for financing instruments and gear.

I haven't used Affirm in about two years now, but tonight opened up the app just for fun to check out my purchasing power and what not.

I wandered over to the purchase history and was shocked to discover that between 2017 and 2023, I opened and completed 25 different loans through Affirm.

At the end of the day, does this positively or negatively affect my profile? I'm curious how this moves the needle. From a newbie's perspective, I'd imagine it demonstrates trustworthiness with the 25 fulfilled loans with zero late payments, and I'd imagine it adds thickness (is that the term we use?) to my profile.

However, I'd love to hear from some people who actually know what they're talking about.

I've never used Affirm, but many of my friends and family have. I don't know if this is always true, but many said that only the first loan is reported to credit bureaus. All subsequent ones are not, unless you default. Please correct me if this is in error. In addition, they said their scores went up initially, but then went back down to the original level when the loan was paid. Thanks.
Well here's the deal a little bit of nuance is required.

If you take an affirm loan for say 12 months that is going to get reported but if you take a 0% interest loan that you pay off in one month that won't be reported. Similarly things like zip pay and sezzle do not report to the credit bureaus either. Basically if it's a zero interest one of those make four payments every two weeks kind of deals you're fine but if you take an actual loan and it has interest then it gets reported.
This is from the Affirm website:
Affirm credit reporting: Plans originated before April 1, 2025
What information does Affirm report to the credit bureau?

Beginning April 1, 2025, all Affirm payment plans and associated repayment activity will be reported to Experian. Additionally, Affirm will begin reporting this information to TransUnion on May 1, 2025, and may report to other credit bureaus in the future. For more information on how plans originated after April 1, 2025, will be reported, click here.

Affirm currently reports some payment plan and repayment activity for plans originated prior to April 1, 2025 to Experian. Typically, your first monthly installment plan with Affirm is reported. After you’ve had at least one plan furnished, Affirm won’t report subsequent plans unless they become 30+ days overdue.
Ouch. Affirm sucked before, this just makes it worse.

Agreed...my wife used Affirm specifically because it was not reporting, so it did not affect her utilization or new accounts parameters. She's not happy.

Re: Affirm Installment Loans

FICOdawg — Wed, 28 May 2025 19:16:24 GMT

Affirm with the 0% for six months was actually good deal. I had bought some pretty expensive car parts (engines, superchargers, etc) with it. Won't be using it going forward especially since my #1 goal at moment is 800+ FICO score for a large boat loan....

Re: Affirm Installment Loans

FICOdawg — Wed, 28 May 2025 20:16:19 GMT

OK now that's crazy. How would that even be possible as loans from the manufacturer have been out there for ages.

Re: Affirm Installment Loans

Thomas_Thumb — Mon, 02 Jun 2025 01:36:35 GMT

In-store (retail installment loan) financing is a common type of CFA. It is frequently used for furniture, appliance purchases and home improvement projects. Many consumers opt in when offered with a 0% financing promotion.

Car dealerships have access to CFA loans available through institutions such as GE capital. The loan may carry high interest rates for higher risk applicants or could be 0% incentive loans from the manufacturer for those with high credit scores.

Unfortunately, all CFAs are considered elevated risk by Fico. Probably because the classification includes payday loans and debt consolidation loans.

Re: Affirm Installment Loans

Zoostation1 — Sun, 01 Jun 2025 18:42:02 GMT

@Thomas_Thumb wrote:
In-store (retail installment loan) financing is a common type of CFAs. They are frequently used for furniture, appliance purchases and home improvement projects. Many consumers opt in when offered with a 0% financing promotion.

Car dealerships have access to CFA loans available through institutions such as GE capital. The loan may carry higher interest rates or could be 0% incentive loans from the manufacturer.

Unfortunately, all CFAs are considered elevated risk by Fico. Probably because the classification includes payday loans and debt consolidation loans.

That's a big flaw in the models imo. Auto loans should inherently be treated as regular installment loan and not a CFA, regardless of whether it's from GE Capital, a bank, CU, etc. There mere fact that an auto loan can be in the same classification as a payday loan is unacceptable imo Obviously I can't change how they are coded, but to me it's one of the more egregious flaws.