Does Affirm Report to Credit Bureau?

Have you been considering using Affirm for your purchases but wondering if it would affect your credit score? If you are new to using credit or are rebuilding your credit score, you may be wondering if using Affirm affects your credit score. We have gathered all the information you need to know about whether Affirm reports to credit bureaus.Affirm is a service that allows you to make purchases in installments rather than paying the full amount upfront. The company partners with various merchants and offers consumers the ability to pay for products and services in three, six, or twelve monthly installments. The interest rates on these installment loans can vary between 0% to 30% APR, depending on the merchant you are purchasing from, as well as your credit score.

Does Affirm Run a Credit Check on You?

When you apply to use Affirm for your purchases, the company will perform a soft credit check, which does not affect your credit score. This soft credit check is only done to verify your identity and determine whether you are eligible to make purchases using Affirm. Once you are approved, Affirm may run a hard credit check on you, depending on the merchant and the purchase amount.

Does Affirm Report to Credit Bureaus?

The good news is that as of 2021, Affirm reports to credit bureaus. This means that making payments on time with Affirm can help improve your credit score, especially if you have a limited credit history. However, the company only reports to two of the three major credit bureaus, Experian and TransUnion.It is important to note that missing payments or defaulting on your loan can have a negative effect on your credit score. Your credit history and payment activities with Affirm will be reported to the credit bureaus and will be used to calculate your credit score.

How Does Affirm Help Build Your Credit Score?

Using Affirm responsibly can help build your credit score if you have limited or poor credit history. Affirm reports to credit bureaus on a regular basis, which means it will be reflected in your credit report. Making on-time payments and paying off your debt can significantly improve your credit score. Here are some ways in which Affirm can help:

1. Credit Mix:

Affirm can help add installment loans to your credit mix, which is one of the factors that affect your credit score. Having a mix of revolving and installment accounts, such as credit cards and auto loans, can improve your credit score.

2. On-time Payments:

Making payments on time with Affirm can help establish a good payment history, which accounts for 35% of your FICO credit score. Missing payments or defaulting on the loan can negatively affect your credit score.

3. Building Credit History:

Using Affirm responsibly can help build your credit history. The longer your credit history, the higher your credit score. Your credit history is calculated based on the average age of your credit accounts.

Final Thoughts

Affirm can be a useful tool for those who want to make purchases in installments rather than upfront. Fortunately, as of 2021, Affirm reports to credit bureaus, which means responsible use can help improve your credit score. However, make sure to make payments on time and avoid defaulting on the loan, as it can have a negative effect on your score.If you are trying to build or maintain a good credit score, consider using Affirm responsibly to make purchases. It can help improve your credit mix, build your credit history, and establish a good payment history. Remember, always keep an eye on your credit score and report to make sure there are no errors or inaccuracies.