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FICO to incorporate buy-now-pay-later loans into credit scores

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277 points cebert | 2 comments | 24 Jun 25 00:03 UTC | HN request time: 0.025s | source
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firesteelrain ◴[24 Jun 25 00:21 UTC] No.44361592[source]▶
Credit scores will tank further
replies(3): >>44361606 #>>44361746 #>>44361866 #
UltraSane ◴[24 Jun 25 01:02 UTC] No.44361866[source]▶
If customers make every payment their score should improve.
replies(4): >>44361943 #>>44362076 #>>44362277 #>>44364598 #
firesteelrain ◴[24 Jun 25 01:39 UTC] No.44362076[source]▶
Not if it shows a bunch of Affirm loans. You could look overleveraged for say getting a mortgage
replies(3): >>44362220 #>>44362233 #>>44368151 #
bitmasher9 ◴[24 Jun 25 02:05 UTC] No.44362233[source]▶
1. Maybe they are over leveraged, let a bank to decide with all the data.

2. BNPL often has short durations (3 months) so it’s not a long term problem for people with BNPL if they pay it all back.

replies(1): >>44363142 #
firesteelrain ◴[24 Jun 25 05:42 UTC] No.44363142{3}[source]▶
Affirm can go up to 60 months on larger purchases

A bunch of tiny loans does not loom good

replies(1): >>44365120 #
astura ◴[24 Jun 25 11:48 UTC] No.44365120{4}[source]▶
Urban myth.

I successfully applied for a mortgage with ~30 credit cards open. Nobody batted an eye, or even commented on it. They looked at balances and credit score. Balances were almost all zero and credit score was excellent.

A hundred small loans that were all paid off on time over the last decade is extremely helpful getting you a mortgage, it doesn't hurt.

replies(1): >>44365950 #
1. firesteelrain ◴[24 Jun 25 13:19 UTC] No.44365950{5}[source]▶
> Balances were almost all zero and credit score was excellent

Not the same.

> hundred small loans that were all paid off on time over the last decade is extremely helpful getting you a mortgage

Again, not the same.

Affirm can be worse than credit cards because credit cards are a single line of credit of X size. The people using it don’t realize that a bunch of tiny lines of credit add up to a larger one ultimately and they can find themselves overleveraged.

replies(1): >>44369957 #
2. FireBeyond ◴[24 Jun 25 19:23 UTC] No.44369957[source]▶
I wonder how it will be implemented. Because for me, Affirm shows my "purchasing power" almost like a credit card, even if it's currently utilized across multiple purchases. So I could see a difference between "making payments on an open balance of $X on an account with $Y purchasing power", even if those payments are subdivided into the original purchases, versus, "You have 7 open Affirm loans".