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Equifax adding Buy Now Pay Later to reports

IntegerIntrovert
Regular Contributor

Equifax adding Buy Now Pay Later to reports

Message 1 of 19
18 REPLIES 18
SouthJamaica
Mega Contributor

Re: Equifax adding Buy Now Pay Later to reports


@IntegerIntrovert wrote:

 

https://texasnewstoday.com/equifax-adds-buy-now-pay-later-plan-to-credit-report/578823/

 

 


It will be interesting to see how FICO algorithms treat them. Dollars to donuts they will have an unfavorable connotation, being interpreted as a sign of financial distress.

 

 


Total revolving limits 689000 (587000 reporting) FICO 8: EQ 715 TU 712 EX 695

Message 2 of 19
calyx
Super Contributor

Re: Equifax adding Buy Now Pay Later to reports

If this is implemented, I can't imagine how it won't be messy as heck (for all of the reasons mentioned in the article).

 

 

F8 EQ: 807 | EX: 785 | TU: 790 | Accounts: 1/6 3/12 6/24 | Reporting: AZE8
Happy practitioner of AZE7or8or9or10 | Team Finances > FICO
Message 3 of 19
Curious_George2
Valued Contributor

Re: Equifax adding Buy Now Pay Later to reports

That article is utterly incomprehensible. Among the countless things about which it is unclear is whether this new type of reported data will include payment plans created within a pre-existing tradeline, such as Amex's Plan It or Chase's My Chase Plan. I wouldn't draw any conclusions about that -- or anything, really -- from this one shoddy piece of "reporting."

 

(Note: All of my criticism is aimed at the article's author, not any member here.)


Message 4 of 19
NRB525
Super Contributor

Re: Equifax adding Buy Now Pay Later to reports


@SouthJamaica wrote:

@IntegerIntrovert wrote:

 

https://texasnewstoday.com/equifax-adds-buy-now-pay-later-plan-to-credit-report/578823/

 

 


It will be interesting to see how FICO algorithms treat them. Dollars to donuts they will have an unfavorable connotation, being interpreted as a sign of financial distress.

 

 


Yes, no mention of how FICO will include them, so much uncertainty there.

However given the average size of these, I'd wonder whether the folks using these may often be using payday loans, so for those folks, is it a wash whether they use payday or Pay In 4? Speculation at this point, without some specific information whether they are included in "New Account" reporting? Closed account? Utilization during and after usage? Certainly potential for a fast cycle of usage for these.

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
April 2022 EQ=811 TU=807 EX=805 - TU VS 3.0 765
Message 5 of 19
Phana24
Regular Contributor

Re: Equifax adding Buy Now Pay Later to reports


@Curious_George2 wrote:

That article is utterly incomprehensible. Among the countless things about which it is unclear is whether this new type of reported data will include payment plans created within a pre-existing tradeline, such as Amex's Plan It or Chase's My Chase Plan. I wouldn't draw any conclusions about that -- or anything, really -- from this one shoddy piece of "reporting."

 

(Note: All of my criticism is aimed at the article's author, not any member here.)


Excellent critique.  What I found missing is whether the creditors in question intend to report anything to the CRAs.  If they don't report, exactly how does Experian intend to "include" them?

 

 

Message 6 of 19
RootDet
Frequent Contributor

Re: Equifax adding Buy Now Pay Later to reports

I think this is a bad idea. For example, i will often take advantage of splitting payments into 4 for 0%. Why? cash flow. Why spend all my money today when I can split it over 6 weeks at 0% APR.

 

But if these make it to the credit report? I think these companies will find them not being used as much. I can't see how even a thin profile will stand against these quick loans. You cannot tell me they will get a huge increase in scores if they open up let's say 10 of these pay in 4 loans or whatever for christmas.

AS usual, it is time to jump off the train as it is gotten crazy. 



Message 7 of 19
bmmob
Established Member

Re: Equifax adding Buy Now Pay Later to reports

This is why I refuse to use Affirm and use ZIP(Quadpay) instead. I could understand reporting these "buy now, pay later" loans only if they were due monthly at minumum for 6 months for a minimum purchase amount of $500 but reporting of bi weekly payments for only four weeks would be absurd and unnecessary.

Message 8 of 19
Yasselife
Established Contributor

Re: Equifax adding Buy Now Pay Later to reports

@IntegerIntrovert 

I noticed CK reports Chase account as *flexible spending credit card* 


Message 9 of 19
FinStar
Moderator

Re: Equifax adding Buy Now Pay Later to reports


@Yasselife wrote:

@IntegerIntrovert 

I noticed CK reports Chase account as *flexible spending credit card


@Yasselife 

That reporting piece has to do with Chase allowing charges over the 'hard' limit on some Visa Signature (or WE) accounts, nothing to do with BNPL.

 

That said, Chase offers My Chase Plan® which allows accountholders to split large purchases into equal monthly payments for a fixed monthly fee + no interest. The reporting of any balances under My Chase Plan® does not fall under the "flexible spending credit card"  category, though.

Message 10 of 19
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