What Credit Score Do You Need for Affirm Approval?

By now, we’ve all seen it. You get to the checkout and get an offer to pay for your item in four installments. Some retailers call it EasyPay, some call it FlexPay, but it’s commonly known as “Buy Now, Pay Later.” And this payment method isn’t just for high-ticket items. You can use the payments for everything from a Chipotle burrito to season tickets to sporting events.

Affirm is a well-known Buy Now Pay Later (BNPL) service. When you use Affirm to finance an item, you can take it home immediately and pay it off in installments. But what credit score do you need to be approved for an Affirm payment plan?

READ MORE: What is Buy Now Pay Later?

Key points

• A credit score of 640 or higher is your best shot at approval with Affirm
• Affirm offers “pay in four” plans (which don’t charge interest) and longer-term installment loans (which do charge interest)
• Credit score requirements are lower if you’re looking for a “pay in four” plan — the retailer may not even check your credit score at all
• Credit score criteria are higher if you’re applying for an installment loan — that’s where you need the 640 credit score
• Because Affirm payment plans are easier to get than traditional loans, it’s easy to commit to too many payments at once
• Try to limit yourself to one Buy Now Pay Later plan at once. When the first is paid off, then move on to a second one. You don’t want to get trapped in a cycle of debt

A credit score of 640 or higher gives you the best shot at approval

Qualification criteria for BNPL programs are complicated, but you have a good shot with Affirm if your credit score is above 640.

But if your credit score is lower, you may not be out of luck.

Affirm approval odds: You are “more likely to be approved” with a score of 640 or above. However, there have been reports of some borrowers with credit scores around 550 being approved. Approval’s possible if your score exceeds 600, but that will depend on factors like your revolving balances and how many hard inquiries are on your credit report. Factors like payment history and whether you’re near your credit limit will make a difference.

Affirm.com

Affirm is unique in the BNPL industry because it offers both longer-term installments and “pay in four” plans. Those longer-term loans mean Affirm’s credit score requirement is slightly higher than most other BNPL companies.

Pro tip: It’s important to note that while there’s no additional cost to use Affirm’s four-payment plan, you will be charged interest on longer-term plans. Unfortunately, not everyone is aware of the interest charges when they’re panicking over an expense they otherwise wouldn’t be able to afford.

Affirm at a glance

Loan amounts	$50-$17,500
Minimum credit score	None stated, but reports show borrowers will need a minimum of about 550 for approval
Interest charges	0% for Pay-in-Four plans, 30% APR for monthly plans
Credit check	Yes, a soft one that won’t affect your credit score
Payment structures	Pay over four installments over eight weeks or a monthly payment plan
Late fees	Account pause after a missed payment
Other fees	None
Availability	Online and in brick-and-mortar stores
Payment rescheduling	No
Account pause after missed payment	No

Other Affirm loan approval factors

In addition to your credit score, your loan application may also be affected by any or all of the following:

• Your credit utilization ratio
• Your previous payment history with Affirm, including overdue payments, deferred payments, and loan delinquency
• How long you’ve had an Affirm account
• The number of loans you currently have with Affirm
• Verification of your income and debt obligations and recent bankruptcies

Do Affirm loans appear on credit reports?

It depends on the type of payment plan you have. Affirm is one BNPL provider that typically will report information to the three major credit bureaus.

• If you sign up for one of the no-interest payment plans, it likely will not be reported to the credit bureaus at all, unless you pay late or skip a payment.
• If you sign up for an installment loan that charges 30% APR, that will be reported to Experian and will appear on your credit report.

Pro tip: Each Affirm application is evaluated as a separate, closed-end transaction, so you can have several Affirm loans open at once.

Does Affirm approve borrowers with bad credit?

Technically no. You’ll need “fair” credit to be guaranteed approval for an Affirm loan. However, reports indicate that it is possible to be approved for an Affirm payment plan with bad credit.

Pro tip: Bad credit is usually a score of 580 or below.

Reports from customers say they have been approved despite credit scores as low as 550. Other factors, including previous history as an Affirm customer and a solid payment history with Affirm, will work in your favor if your credit score is below 600.

Does Affirm check credit?

Yes, Affirm will conduct a soft credit check through Experian, one of the three major credit bureaus, but that won’t affect your credit score. One of the major perks of companies like Affirm is the ability to take on new credit without a change to your score. You can create an account and prequalify with no impact.

Pro tip: Soft inquiries don’t show up on your credit report and only require a phone number and address. Hard inquiries require your Social Security number, income, and credit utilization ratio and will appear on your credit report.

Will Affirm boost your credit score?

Affirm will only help your credit score if you sign up for one of the longer payment terms. The short-term, no-interest plans won’t help your credit score, but could hurt it if you pay late or don’t make on-time payments.

Affirm’s longer-term loans could help your credit score if repayment is timely. If you miss or make late payments, it will hurt your score.

Pro tip: A single late or missed payment will stay on your credit report for up to seven years.

Since these purchases are considered loans, they will also affect your debt-to-income ratio. It’s essential to your credit score because lenders use DTIs and other aspects of your financial profile — like your credit history — to evaluate whether to give you a new loan and determine lending limits.

What makes Affirm different?

Affirm is a point-of-sale payment plan. At checkout, in-store or online, you can pay for your purchases in installments. Affirm is one of several companies offering these plans. Others include Afterpay, Klarna, and PayPal Pay in 4. These companies are known as Buy Now, Pay Later (BNPL) or Pay-in-Four plans. 

These new-ish financing options are similar to old-school layaway plans, but you get to take the item home immediately before it’s been paid in full. It splits the purchase amount up into four or more payments.

With a layaway plan, the consumer gives an installment deposit towards the product’s sale price and makes subsequent installments while the store puts the item on hold. The product is handed over to the consumer when the last payment is made.

Affirm differs from most other BNPL companies because you can split your total into more than four payments. However, you need to use caution because, unlike similar companies, Affirm charges interest on some plans. The interest charges can often be an unpleasant surprise for users who’ve used similar companies. Make sure to read the terms and conditions carefully.

How does Affirm work?

Affirm is a loan company that allows users to buy goods or services offered by online merchants and pay off those purchases in fixed monthly payments.

When you get to the checkout, you’ll be offered the option to split up your payments. Or you can get a virtual Affirm card in the Affirm app. According to the Affirm website, the minimum loan amount to use Affirm payments is $50, while the maximum is $17,500.

Affirm payment plans are repaid in the app or Affirm.com with a linked debit card or checking account, or you can mail a physical check. For some purchases, the down payment and all installments can be charged to a credit card.

Does Affirm charge interest?

Yes and no. Affirm doesn’t charge interest if you pay in four installments. However, if you finance your purchase over an extended period, you will pay up to 30% APR.

Affirm also doesn’t charge hidden fees. There is one possible fee for late or missed payments. There are no origination fees or prepayment fees.

Which retailers use Affirm?

Here are a few popular retailers that offer financing through Affirm:

• Adidas
• Best Buy
• Delta Vacations
• Expedia hotels and vacation packages
• Neiman Marcus
• Nike
• Peloton
• Pottery Barn
• Purple
• Saks Fifth Avenue
• Target
• Walmart

What’s the problem with Buy Now, Pay Later?

According to a report by the Consumer Financial Protection Bureau (CFPB) 64% of Buy Now, Pay Later (BNPL) users have incomes of less than $50,000 per year, and 81% have incomes of less than $75,000, according to an industry study by Cardify. And previous survey findings by DebtHammer show that 30% of BNPL users have e struggled to make the payments and had to skip paying an essential bill to avoid defaulting on their payment plan.

When the economy was booming, companies like Affirm soared. But now, Buy Now Pay Later companies are grappling with increased defaults as inflation and interest rates climb. In February 2023, Affirm laid off nearly 20% of its workforce.

READ MORE: What are the risks of Buy Now Pay Later?

Should I use a BNPL plan?

It depends. Buy Now Pay Later can be a great way to cover an emergency expense that you may not be able to afford immediately without otherwise turning to a short-term lender. For example, if your computer dies and you cannot work without one, you can go to Best Buy or Walmart and finance a new one and be back at work within hours. The danger with BNPL is when it’s overused, and people struggle to make multiple payments every other week or when you finance something over the long term.

Pro tip: The goal is to only sign up for one Buy Now Pay Later plan at a time. When that first item is paid off, you can take on a second one and repeat the process. But if you buy five or six items at once and agree to pay them off in $20 increments, suddenly you’re paying $100 to $120 every other week, and that’s causing a lot of Americans to struggle. With Affirm, it’s best to stick to the no-interest four-payment plan if you can afford it. However, if you can’t, just be aware that Affirm charges interest. But despite that added cost, Affirm can be an affordable way to get an item you need immediately and pay it off at a lower interest rate than what you’d pay for a payday loan, title loan or some personal loans.

Affirm real-world experiences

Many of the complaints about Affirm are similar. Customer comments primarily cite problems with items that were returned, or paying interest borrowers didn’t know about.

The biggest problems appear to be using Affirm for travel expenses like airfare and hotels. If the trip has a complication requiring you to be refunded by an airline or other travel platform, the money isn’t always returned seamlessly. There can be confusion and long waits. And buyers won’t have the same protections offered through credit cards, like chargebacks for faulty or lost items in transit.

The other is interest. Many people see the option to pay with Affirm and assume there is no interest because the “Pay in Four” option is advertised as interest-free. But when they’re offered the option to pay over a longer term at checkout, not everyone realizes that interest kicks in.

For example, one Affirm user charged a subscription that cost $1,000 per year. Affirm gave her the option to pay over 18 months. Not only did she end up paying 30% interest, but when it came time to renew her subscription the following year, she still owed six payments on the original and ending up having to make double payments for six months. 

Make sure that if you commit to a BNPL plan, you can afford the payments you agree to. Otherwise, you’ll end up paying extra fees and end up hurting your credit score further.

How to apply for financing through Affirm

Affirm works with hundreds of major retailers. Applying is easy and can be done at checkout, either in person or online. If you want to save time during checkout, you can use the Affirm app to prequalify for a virtual card, which works like a debit card. You can use this card both in-store and online.

Personal information

Affirm asks for a few pieces of personal information: 

• Name
• Age (you must be 18 or older in most states, including U.S. territories)
• Valid mailing address
• Email address
• Mobile phone number
• Date of birth
• The last four digits of your social security number

Affirm uses this information to verify your identity and make an instant loan decision.

Affirm vs. Afterpay: Which is better?

Afterpay is an Australian-based BNPL company that competes directly with Affirm. The difference is that Afterpay only offers four-payment plans repaid over six weeks (the first payment is made at the point of purchase and serves as a down payment, then you make biweekly payments.) Afterpay does not charge interest. Afterpay does charge late fees: $8 or 25% of the transaction, whichever is less. Afterpay does not do any credit checks, so eligibility is open to everyone, but if you miss payments, you’ll incur late fees. Afterpay is accepted by 100,000 retailers globally.

In a May 2022 press release, Affirm’s CEO cites that the number of active merchants on their platform grew from 12,000 to 207,000 year over year, and active consumers increased 137% to 12.7 million people. Affirm is a revenue generator and marketing accelerator for more powerhouse merchants like Walmart, Neiman Marcus, Target, Priceline, Vrbo, Ikon Pass, Theory, Williams Sonoma, and many more.

So, depending on which retailers you shop at and which payment plan and interest rate are more beneficial to you, it will dictate whether Affirm or Afterpay is a better fit. Read the fine print before committing to anything.

Is Affirm better than a credit card?

Maybe. If you’re using a no-interest repayment plan, that will likely be better than paying with a credit card, and it is definitely better than turning to a payday lender.

If you need a longer-term plan that charges interest, a balance transfer credit card would be better, but qualifying for one can be challenging if you have bad credit, and it can take time for the card to arrive in the mail. Depending on the expense, you may be unable to wait 7-10 business days for the new credit card to arrive. And the interest rate Affirm charges may be lower than what you’d pay a credit card company, mainly if you already carry a balance on the card.

Pro tip: Before committing to an Affirm loan, always check your credit card interest rates. Depending on the rate you pay, using a credit card could be significantly cheaper, particularly if you have a targeted low-APR offer for new purchases.

The bottom line

If you need to make a large purchase immediately and can’t afford to pay it off over four payments, Affirm can be a good option for people with credit scores of 550 and up. The interest rate it charges is far lower than what you’d pay a payday lender or even an installment loan for bad credit borrowers.

Also, keep in mind that there are many risks with Buy Now Pay Later plans, including the risk of becoming overextended by payments, overdraft fees if you forget payments, being banned from the service until your account is paid, paying hidden interest or high late fees, and most importantly, giving up some of the valuable consumer protections that credit card companies provide.

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