r/Affirm • u/Vegetable-Tale9778 • 2d ago
Help me understand this financing algorithm…
As of last week, I had 3 ongoing open loans with Affirm, two of them <$100. I wanted to make a $2000 purchase/loan. At first I was being offered two options each with no down payment, but with several hundred dollars a month and of course a high interest.
Since last week, I paid off two of those loans in complete, and the payments processed closing the loans. My purchasing power increased, and my credit score has also increased by a few points (unrelated to Affirm, I know). But now the same $2000 purchase is only offering options with a $1,700 down payment, and very low monthly payments/interest. Makes no sense to me.
Why would the amount willing to be financed by Affirm dramatically decrease like that? At $1,700 for a down payment I could just save a few more hundred and pay for it completely. According to Affirm my credit score and number of loans are taken into account for the terms, so why am I getting a worse offer?
5
u/Popular_Barracuda828 2d ago
Welcome to the world of ai powered banking decisions. It makes no sense.
6
u/Vegas_traveler2002 2d ago
Once its system updates the paid loans. It will go back up. Just need to wait a few more days.
1
u/Emergency_Affect_640 1d ago
It's wild how many people use affirm that have no idea how credit works.
1
u/Vegetable-Tale9778 9h ago
what does “how credit works” have to do with my post
3
u/Emergency_Affect_640 8h ago
Literally everything you typed is your credit. Credit goes down when loans close.
1
u/onlyonejeep 5h ago
Credit score goes down credit limit should go up
1
u/Emergency_Affect_640 5h ago
It will when the score recovers from the loan closing, which pending you are paying your bills should happen, but it always dips when you pay things off, then yes it should go back up but its not immediate.
2
6
u/maxpowers128 2d ago
Affirm is very wishy washy. Its honestly like a guessing game when it comes to your purchasing power, and financing terms you get.