2023 Affirm Loan Review
Affirm is a lender that offers buy now, pay later (BNPL) and personal loans to consumers in the final steps of making retail purchases. You can access 0% financing with Affirm BNPL loans, though its personal loans may come with interest. Major retailers like eBay, Amazon and Best Buy offer Affirm financing.
- 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 1 to 48 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 Affirm payments, this could impact your ability to take out future Affirm loans.
- Offers soft credit pulls: You can prequalify for a personal loan through Affirm without any impact to your credit score.
- Down payment may be required: Affirm may require you 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 $17,500.
- Limited use: While you can use loans from other companies for a number of reasons, Affirm loans are limited to retail purchases. However, Affirm isn’t available at all retailers.
- Best for retail shoppers: If you’re planning for a large purchase at a retailer, it’s a good idea to check if they’re partnered with Affirm. The lender may also be a good fit for shoppers who have a thin or poor credit history.
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:
0% financing available for short-term BNPL loans
Doesn’t charge any fees
Option to prequalify for a loan
Small loan amounts available
Can find much larger loan amounts elsewhere
May have to provide a down payment
Use limited to retail purchases
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 interest 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.
However, if you’re looking to cover a purchase that’s over $17,500 or need to cover a nonretail expense, this lender may not be for you. In addition, Affirm doesn’t publish details of its loan requirements on its website, making it difficult to know if you’d qualify, and you may need to provide a down payment.
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 it won’t impact your credit score. This payment plan is best for smaller purchases.
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 1 to 48 months. Further, Affirm reports some loans to Experian which can help boost your credit score.
If you don’t qualify, it could be a sign to work on boosting your chances to get approved for a loan. To do this, you’ll need to improve your credit score, cut down on any current debt and check your credit reports for any errors.
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.
|Minimum credit score||Not specified||Not specified||Not specified|
|Loan amount||$50-$17,500||From $400||None|
|Repayment term||1 to 48 months||6 or 12 months||6 to 24 months|
|Funding timeline||Receive funds within minutes of applying||Receive funds within minutes of applying||Receive funds within minutes of applying|
|Bottom line||Of the three lenders, Affirm offers the most flexibility when it comes to borrowing amounts and repayment terms. Unlike Klarna, it also doesn’t charge fees.||Afterpay offers similar APRs to Affirm, but has much less flexible repayment terms. To get a monthly Afterpay loan, you’ll have to spend at least $400.||Klarna offers the lowest maximum APR of the three. However, it does charge late fees and doesn’t offer repayment terms 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.