Affirm is a popular "buy now, pay later" (BNPL) service that allows consumers to split the cost of purchases into smaller, manageable installments. Instead of paying the full amount upfront, Affirm offers flexible payment plans, often ranging from 3 to 36 months. This can make larger purchases more accessible by breaking them down into predictable monthly payments.
How Affirm Payments Are Calculated
When you use Affirm, your payment plan is determined by several factors:
Purchase Amount: This is the total cost of the item or service you're buying.
Number of Monthly Payments: You typically choose a payment term, such as 3, 6, 12, or even up to 36 months. Longer terms usually result in lower monthly payments but may accrue more interest.
Annual Percentage Rate (APR): Affirm offers loans with APRs ranging from 0% to 36%. Your specific APR is determined by your creditworthiness and the merchant. Many merchants offer 0% APR promotions for certain terms, which means you only pay back the purchase amount without any additional interest. If interest is applied, it's typically simple interest, calculated on the principal amount.
Our Affirm Payment Calculator uses these three inputs to estimate your monthly payment, the total interest you might pay, and the overall cost of your purchase.
Using the Affirm Payment Calculator
Enter the Purchase Amount: Input the total price of the item you wish to buy using Affirm.
Select Number of Monthly Payments: Choose your desired payment term from the dropdown menu.
Input Annual Percentage Rate (APR): Enter the estimated APR. If you qualify for a 0% APR offer, enter '0'. Otherwise, use an estimated rate (e.g., 10%, 20%, or 30%) to see how it impacts your payments.
Click "Calculate Affirm Payments": The calculator will then display your estimated monthly payment, the total interest paid, and the total cost of your purchase.
Benefits and Considerations of Using Affirm
Benefits:
Budgeting: Breaks down large purchases into affordable monthly payments.
Transparency: Affirm is known for clear terms with no hidden fees.
Flexibility: Offers various payment terms to suit different budgets.
Potential for 0% APR: Many merchants offer interest-free financing.
Considerations:
Interest Charges: If you don't qualify for 0% APR, interest can add significantly to the total cost.
Credit Impact: Affirm reports payment history to credit bureaus, so missed payments can negatively affect your credit score.
Spending Limits: Affirm has spending limits based on your credit profile.
Always review the specific terms and conditions offered by Affirm for your purchase before committing.