Does using PayPal Pay in 3 affect my credit score?

Does Using PayPal Pay in 3 Affect My Credit Score?

PayPal Pay in 3 is a payment service that allows customers to divide their purchase into three equal payments made over six weeks. Unlike traditional credit options, using PayPal Pay in 3 will not impact your credit score.

How PayPal Pay in 3 Impacts Your Credit

• No Hard Inquiries: When you apply for a credit card or loan, the lender typically performs a hard inquiry on your credit report. This can temporarily lower your credit score. PayPal Pay in 3 does not require a hard inquiry, meaning your credit score will not be affected.
• Potential Soft Inquiry: PayPal may perform a soft inquiry on your credit report when you use Pay in 3 for the first time. This type of inquiry does not impact your credit score and is only visible to you.

Benefits of Using PayPal Pay in 3

• No Negative Impact on Credit: Unlike credit cards, Pay in 3 does not have any negative impact on your credit score.
• Easy Financing: Pay in 3 provides a convenient financing option without the need for a credit check.
• Flexibility: You can use Pay in 3 for purchases at millions of online and in-store retailers.

Considerations

• Late Payments: Missing a Pay in 3 payment may result in late fees and could impact your ability to use the service in the future.
• Interest-Free Period: Pay in 3 is interest-free, but late payments may incur interest charges.
• Loan Limit: PayPal may limit the amount you can borrow using Pay in 3 based on your creditworthiness.

Conclusion

Using PayPal Pay in 3 will not affect your credit score. However, it’s important to make your payments on time to avoid any negative consequences. Pay in 3 can be a helpful financing option for those who need some flexibility with their purchases without impacting their credit history.