How Acima May Impact Your Credit Score

Wondering if using Acima will help or hurt your credit? While lease-to-own services don't always impact your score, Acima's reporting practices mean your payment history could play a role.

1. Initial Application: When you first apply for Acima, the company typically performs a soft credit inquiry. Unlike a hard inquiry, which can slightly lower your score, this initial check has no impact.
2. On-Time Payment Reporting: Acima reports your payment history to Experian. By making all your payments on time, you can potentially build a positive credit history with that bureau over your lease term.
3. Late or Missed Payments: Conversely, if you miss payments or are consistently late, this negative activity may also be reported. Delinquencies are a red flag to lenders and can lower your credit score.
4. Default and Collections: Should you fail to make payments and default on your lease agreement, your account could be sent to a collections agency. A collection account is a significant negative event that can cause severe and lasting damage to your credit profile.

How Much Will Acima Affect Your Credit Score?

When considering a lease-to-own option like Acima, it's wise to understand the potential effects on your credit. Several factors determine how your credit score might change.

• Credit Reporting. Acima reports your payment history to Experian. Consistent, on-time payments can positively influence your credit, while late or missed payments may have a negative impact on your score.
• No Hard Inquiry. Applying for Acima does not involve a hard credit check, so your score won't be lowered by the application itself. This differs from traditional loans that often require a hard pull.
• Financial Obligations. A lease agreement adds to your monthly financial commitments. Lenders may consider this when evaluating your overall capacity to take on new credit in the future.

How You Can Avoid Acima Affecting Your Credit Score

Make On-Time Payments

The most direct way to prevent a negative impact is to make all lease payments on time. Since Acima reports your payment history to Experian, any missed or late payments can result in negative marks. Consistently paying on schedule is the best defense for your score.

Review the Lease Agreement

Before committing, thoroughly review your lease-to-own agreement to understand Acima’s specific policies on credit reporting. Knowing exactly when and what they report to Experian allows you to manage your account proactively and prevent any surprises that could unexpectedly harm your credit standing.

Monitor Your Credit Report

Regularly check your Experian credit report for any activity from Acima. This helps you confirm that payments are being reported accurately and allows you to quickly identify and dispute any potential errors before they can cause lasting damage to your credit score.

Ways to Improve Your Credit Score

Improving your credit score is an achievable goal that relies on consistent, positive financial behavior. According to one expert guide, most people can see meaningful changes within three to six months by taking a few proven steps.

• Monitor your credit reports. Regularly obtain your free reports from Equifax, Experian, and TransUnion to identify and dispute inaccuracies or signs of identity theft.
• Establish automatic bill payments. Setting up automatic payments ensures you never miss a due date, which is critical since payment history is the most significant factor in your FICO® score.
• Reduce your credit utilization ratio. Aim to keep your total balance below 30% of your available credit by paying down debt or requesting a credit limit increase.
• Become an authorized user. Being added to a credit card account with a long history of on-time payments and low utilization can help boost your own score.
• Diversify your credit mix. Lenders like to see that you can responsibly manage different types of credit, such as credit cards, installment loans, and mortgages.
• Limit hard inquiries. Avoid applying for too many new credit accounts in a short period, and when rate shopping for a loan, do so within a 14-30 day window to minimize the impact on your score.

The Bottom Line

Acima's lease-to-own model typically won't affect your credit score. Defaulting on payments can cause harm, but consistent, on-time payments may be reported and could help build your credit history.

Frequently Asked Questions

Does Acima check your credit?

Acima may perform a soft credit inquiry, which doesn't impact your score. They primarily rely on other factors like income history to determine your eligibility.

Will using Acima build my credit?

Yes, Acima reports your payment history to Experian. Making timely payments can help you build a positive credit history and potentially improve your credit score.

What happens if I miss a payment with Acima?

Missing a payment could lead to late fees. Since payments are reported to Experian, a missed payment may also negatively affect your credit score.