Affirm Loan Review
Affirm is a lender that offers buy now, pay later (BNPL) and personal loans that can help you break up retail purchases at partner and non-partner stores. However, shopping with a non-partner store requires an extra (yet easy) step of creating a virtual card. BNPL with Affirm is interest free, though its long-term personal loans may come with interest.
- 0% financing available: You don’t have to pay interest on BNPL plans, though you’ll have much less time to pay it off — just six weeks as opposed to the 3 to 60 months that come with an Affirm personal loan.
- No fees: Affirm doesn’t charge its customers any fees, even late fees. However, if you miss any payments, this could impact your credit score.
- Offers soft credit pulls: You can prequalify for a personal loan through Affirm without any impact to your credit score. And only long-term loans require a hard credit pull when you actually apply (not BNPL).
- Down payment may be required: Affirm may require you to provide a down payment for certain purchases if you take out a loan. Even the BNPL plan requires the first of the four payments upfront when you check out.
- Smaller loan amounts: Many personal loan lenders offer borrowing amounts up to $50,000. Comparatively, Affirm offers small loans from $50 to $20,000.
- Best for retail shoppers: Affirm can help alleviate the stress that comes with buying a big-ticket item by allowing you to pay over time. Plus, Affirm only uses a soft credit pull to determine your eligibility for BNPL, making it a solid choice if you have less-than-perfect credit.
Affirm pros and cons
Like any lender, Affirm has a mix of benefits and drawbacks you’ll want to consider before taking out a loan. Here’s what you’ll want to weigh out:
Pros
- 0% financing available for short-term BNPL loans
- Doesn’t charge any fees
- Checking eligibility doesn’t hurt your credit, and neither does applying for BNPL
- Can borrow as little as $50
Cons
- Won’t work if you need to borrow more than $20,000
- May have to provide a down payment
- Won’t know if your purchase is approved until checkout
Affirm loans are unique, in that you can choose between a short, six-week loan with no interest or a long-term personal loan with an annual percentage rate (APR) ranging from 0.00% to 36.00% APR. The lender doesn’t charge users any fees — even if you’re late. And while traditional lenders offer minimum loans of $1,000 to $2,000, Affirm provides small loans — for as little as $50.
On the downside, Affirm can make it a little hard to plan. Every time you choose Affirm at checkout, consider that a loan application. Affirm reviews your soft credit report, payment history and other factors. Depending on the circumstances, it could decline you. This is true even if you’ve successfully used Affirm in the past.
Affirm requirements
Unfortunately, besides being at least 18 years old, Affirm doesn’t provide much insight as to other requirements you’ll need to meet. Here’s what we do know:
| Minimum credit score | Not specified |
| Residency | Must live in the U.S., U.S. territories or Canada |
| Miscellaneous eligibility criteria | Affirm will consider the following details:
|
If Affirm won’t work for your borrowing needs, be sure to shop around for a lender that helps you meet your financial goals and can offer you the best-fitting interest rates, loan terms and amounts.
How to get a loan with Affirm
Once you make your decision and go to the checkout, if the retailer is an Affirm partner, you’ll have the option to apply for a loan. Affirm offers multiple ways to break up your payments when you make a purchase you’re not able to afford upfront. Here’s how each of them work:
Affirm Pay in 4
This involves breaking up your purchase amount into four equal payments, which Affirm will charge every two weeks. You’ll have to make the first payment upfront during your purchase. The Pay-in-4 plan does not come with interest or fees, and applying for it won’t hurt your credit score (but late payments will). This payment plan is best for smaller purchases.
Affirm loan
If you need to make a larger purchase, an Affirm loan may be a better option than BNPL. While this plan does come with interest, you’ll have a longer amount of time to pay off the loan. Annual percentage rates (APRs) can run from 0.00% to 36.00% and you can choose to repay it in 3 to 60 months. Further, Affirm reports some loans to Experian which can help boost your credit score.
Virtual card
You can still use Affirm to shop with a non-partner store, but you have to create a virtual card first. Go to Affirm’s website or log onto the app to request a virtual card. This will generate a unique credit card number that you then use online like any other credit card.
In-store shopping with a virtual card requires one last step. After you create your virtual card, add it to Apple or Google Pay, and then choose your virtual card once you’re inside your digital wallet.
Affirm virtual cards are accepted almost everywhere that also accepts Visa. Also note that your virtual card will expire within 24 hours if you don’t use it.
How Affirm compares to other personal loan companies
Even if you believe Affirm aligns with what you’re looking for in a personal loan, it never hurts to shop around and compare other lenders. Here’s how Affirm stacks up against similar personal loan lenders.
| Affirm | Afterpay | Klarna | |
|---|---|---|---|
| Minimum credit score | Not specified | No minimum credit score | No minimum credit score |
| APRs | 0.00%-36.00% | 0.00%-35.99% | 0.00%-33.99% |
| Loan amounts | $50-$20,000 | Starting at $400 | No set minimum or maximum |
| Repayment terms | 3 to 60 months | 6 to 12 months | Up to 24 months |
| Late fees | None | Up to $8 (cannot exceed 25% of purchase) | Up to $7 late fee per missed installment, not to exceed 25% of your amount due |
| Funding timeline | May receive funds within minutes of applying | May receive funds within minutes of applying | May receive funds within minutes of applying |
| Bottom line | Of the three lenders, Affirm offers the biggest loans and longest repayment terms. Unlike Afterpay and Klarna, it also doesn’t charge late fees. | Afterpay offers similar APRs to Affirm, but you only have 12 months to pay back your loan. To get a monthly Afterpay loan, you’ll have to spend at least $400. | Klarna offers the lowest maximum APR of the three. It does give you a longer time to pay back your loan than Afterpay, but terms are still not as long as Affirm’s. |
How we rated Affirm
To come up with our star rating for personal loan companies, LendingTree considered 22 data points across three categories:
- Accessibility: We paid attention to whether lenders offered loans to nontraditional borrowers, as well as those without excellent credit scores. We also checked if lenders offered soft credit pulls, and whether they were transparent about eligibility criteria other than credit scores.
- Rates and terms: We wanted to know if lender rates, terms, amounts and fees were not only transparent, but also competitive.
- Repayment experience: We based this category on lenders’ reputations, customer support availability and unique benefits.
The data points reflect every step of the process to shop and apply for, borrow and repay personal loans. A five-star lender, for instance, has flexible eligibility requirements, offers you the chance to prequalify without commitment and supports you in zeroing your balance.
The 22 data points, culled from the lenders themselves, determine the overall rating. We score lenders consistently, sometimes awarding partial points, so that you can make apples-to-apples comparisons when shopping around.
LendingTree isn’t paid for conducting these reviews, and lenders don’t have control over their content. With our reviews and ratings, we aim to give our users the objective and exhaustive information they need to make the best possible decisions.
Frequently asked questions
Also, Affirm and other BNPL apps are generally easy to use and to qualify for. This can lead to impulse purchases. According to a LendingTree survey, 34% of BNPL users paid late at least once over one year’s time.
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