Affirm Personal Loans

If you don’t have a credit card (or don’t want to pay the high interest rates that typically come with credit cards), BNPL apps can be a good funding option for short-term borrowing. With Affirm, you’ll pay no interest if you pay back the loan within four payments — but if you need longer than that, your interest rate will be anywhere from 15% to 36%, depending on your creditworthiness.

If you know you can pay Affirm back before interest kicks in, it’s worth using. However, for large purchases that require a longer repayment period, you’ll want to compare Affirm’s offered rate with your credit card or a personal loan from your bank or another lender.

With most personal loans, you apply for funding in advance of making a purchase. As a BNPL app, Affirm offers you the ability to borrow money right at checkout, similar to how you would shop with a credit card.

When you choose to make purchases with Affirm, you are taking out a closed-end installment loan, which is serviced by one of Affirm's lending partners. These loans have a set payment schedule and end date, which are detailed in your loan agreement.

Financing is available for up to $20,000, or up to $30,000 with a $10,000 down payment. The standard minimum loan amount is $50, although some vendors may choose to set a higher minimum.

Depending on your eligibility, you will be offered:

• Interest-free payments: If you qualify, you’ll be offered a loan that can be paid back in four interest-free payments. With this, you’ll have a payment due every two weeks for eight weeks.
• Monthly installments: Monthly installments are typically offered in three, six-month or 12-month terms, but these terms can vary.

These loans have a few usage restrictions, including:

• Illegal purchases
• Weapons
• Narcotics and drug paraphernalia
• Currency
• Money transfer services, such as PayPal and Venmo
• Loan and credit card payments

Affirm has annual percentage rates (APRs) that range from 0% to 36%, as of publishing, which means that not everyone will be charged borrowing fees on their purchase. However, 0% rates are reserved for certain borrowers. Your rate will be determined by your creditworthiness.

Affirm doesn’t charge any fees for using its loans, not even late fees.

Before you apply to use Affirm, you should make sure that you meet its eligibility requirements. To be eligible, you must:

• Be 18 (19 if you’re a ward of the state of Nebraska)
• Be a resident of the United States or a U.S. territory
• Have a Social Security number
• Own a phone that can receive text messages and is registered within the U.S. or its territories

If you meet these eligibility requirements, you can download the Affirm app and create an account. Once you do, you are ready to use Affirm and can cover your next purchase by doing the following:

1. Shop: Start by shopping at your retailer of choice, whether online or in person. When you’re done, proceed to checkout and select Affirm as your checkout method. If you don’t see Affirm, you can request a virtual card from its app on your phone.
2. Select your terms: Affirm will provide you with multiple different loan options, depending on what you qualify for. With this, you’ll have the option to pay in four installments with no interest or extend the loan out up to 12 months with interest.
3. Pay back your loan: You’ll need to pay your loan back based on the payment schedule outlined in the loan agreement provided by Affirm. To make this easier, Affirm recommends that you set up autopay.

Unlike traditional personal loan lenders, Affirm only offers loans at the time of sale. Due to this, it can be difficult to compare it to other lenders. That said, here is how it measures up to a more traditional lender, OneMain Financial.

Since being founded in 2012, Affirm says it has helped its customers afford over 17 million purchases. It partners with Cross River Bank, Celtic Bank and Lead Bank to service its loans to provide loans. It has an A+ rating with the Better Business Bureau (BBB); however, it has a 1.17-star rating average with the BBB at the time of publishing.