PayPal Credit and Credit Bureau's

BiffBoom
Contributor
Contributor

Just trying to find out WHY PayPal Credit doesn't report to the Credit Bureau's.   I would think that that topic would be important enough to place in the FAQ.  Oh well.  Hope someone can explain.Thanks. 

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43 REPLIES 43

sylvanmonk
Contributor
Contributor

I would also like to know the answer to this question.  Because there's no option to report to credit bureaus, PayPal Credit doesn't help customers like me build/rebuild/improve their credit scores.

Based on my current situation, if PayPal Credit started reporting to credit bureaus tomorrow, my credit score would jump from 685 to at least 730 overnight because it would drop my credit usage ratio from 90% (based on my two credit cards) down to 60% (based on my two credit cards plus my PayPal Credit account).  This would obviously be a huge help to me as I work on paying down my credit card and student loan debt in preparation to finance a new car and a house within the next few years.

I'm sure there are other PayPal Credit customers who aren't in good standing and who appreciate that PayPal Credit does NOT report to credit bureaus because of that fact.  But for those of us who are in good standing, having the option to demonstrate our credit worthiness to the credit bureaus would be one more reason to LOVE PayPal Credit.

Are there any plans to offer such an option?  If not, why not?  Thank you for your time and the wonderful service you provide your customers.

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BiffBoom
Contributor
Contributor

So in two months, no one from PayPal Credit can answer the simple question of WHY they extend credit, set minimum payment amounts, along with, payment notices and yet, DO NOT report to the credit bureau's.   It appears that I'm not the only concerned user.  Now, if PayPal were to email me a question, I'd gladly reply within a day or two.  Being with PayPal for over 15 years definitely doesn't receive any favorable treatment or kudo's.

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Veronica-T
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Contributor

I would also like to know the answer to these and other related questions.

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Southeddy
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Contributor

I took a chance and applied for the PayPal credit this morning because I was turned down by another credit card co.

I'm trying to rebuild my credit after paying cash for all my purchases for the past 12 years. ( because of a BAD divorce)

I made a 112.00$  purchase just to get "the ball rolling" as they say, and now I found out that PP won't report my progress.

That doesn't make any sense at all.  What is PP wanting to do, encourage the dead beats?

All I want to do is rebuild my credit. I will pay this debt off next week and never use this "BS" again.

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Veronica-T
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Contributor

I am in a similar situation. I thought a PayPay credit card would help me build up my credit score, but they don't report. Now I am afraid to apply for another credit card because it might ding my credit rating to have too many inquiries.

 

My score dropped from "barely able to qualify for a house" to "go live under a bridge for all we care" due to multiple credit inquiries, all from mortgage companies. Now I am afraid I am going to make things worse.

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Bigtexun
New Community Member

Unfortunitely, Paypal only hurts your credit, they do nothing to help it. 

 

I applied by accident by simply hitting the wrong button when I was buying some computers on  a manufsacturer's web site.  I clicked paypal credit instead of paypal, and suddenly I have this huge credit line.

 

Of course my credit score immediately dropped due to the query from applying for credit.

 

But applying by pressing one button in error had more than just the effect on my credit.  The account was set up completely wrong.  They used my company credit card's billing address, rather than my address, and they also sent a huge pile of paperwork to that address, packed full of info I would rather not be sharing with co-workers I don't know in another state.  And I never knew I was applying for a credit account.  All I was doing was using paypal so that my company credit card had less e-commerce-hack exposure.

 

After I placed my order, my computers arrived, but I never saw any charge, It wasn't on my company card, and it wasn't on any of my personal cards.  I was supposed to report the purchase on my expense report, but I could never find it.  So with a great deal of concern over what happened, I was debating what to do.  When the computers arrived, I locked the unopened boxes up, because I expected that the purchase was going to come back and bite me.  At this point in time I am unaware of the paypal credit account.

 

About a month later, someone in my company forwarded the paperwork they sent to the billing address,.  HUGE surprise.  I immediately returned the computers, eating the return fees personally.  I then corrected the billing address, and re-ordered the computers so that they would be correctly billed.  I explained to the computer company what had happened, but they couldn't help me move the charge to the correct account, so the return/reorder was the only possible resolution.

 

After it was all corrected, I considered my options with the account.  In the end I decided to keep it, as it would improve my credit, right?  I'm trying to buy a new house next year, so improving my debt ratio is a good thing!  As me and my wife were working through the process of deciding what we were going to do with regard to buying a house, we were checking our credit constantly.  The hit from thre paypal credit account creation was the first thing I noticed, but I fugured that they would start reporting soon.  I used the account a whole bunch for a while, thinking that the card being active is more likely to start reporting sooner than later...  Here I am 10 months later, and I'm finding that they are not reporting, and that they will never report (unless I fail to pay).

 

Now someone told me that Paypal doesn't report to the bureaus at all.  I happen to know that is not true at all.  They do a hard query when you apply, and if you go deliquent they report that to the bureaus.  They don't do anything to help your credit, but if you are late with a payment they will in fact ding your credit.

 

I just asked then to close my account tonight.  Too much risk, and zero reward.  I can open up a "real" credit line elsewhere that will reward me with good credit for paying.  Sure, all credit accounts have risk, but when they report your good status and unused credit to the bureaus, it mitigates the risk.  Paypal credit is not mitigating the risk.

 

Now that isn't always a bad thing, but it is up to you on how much uncompensated risk you want to be exposed to.  For me, it is zero.

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bobmpls
Contributor
Contributor

@Bigtexunwrote:

Unfortunitely, Paypal only hurts your credit, they do nothing to help it. 

 

I applied by accident by simply hitting the wrong button when I was buying some computers on  a manufsacturer's web site.  I clicked paypal credit instead of paypal, and suddenly I have this huge credit line.

 

Of course my credit score immediately dropped due to the query from applying for credit.

 

But applying by pressing one button in error had more than just the effect on my credit.  The account was set up completely wrong.  They used my company credit card's billing address, rather than my address, and they also sent a huge pile of paperwork to that address, packed full of info I would rather not be sharing with co-workers I don't know in another state.  And I never knew I was applying for a credit account.  All I was doing was using paypal so that my company credit card had less e-commerce-hack exposure.

 

After I placed my order, my computers arrived, but I never saw any charge, It wasn't on my company card, and it wasn't on any of my personal cards.  I was supposed to report the purchase on my expense report, but I could never find it.  So with a great deal of concern over what happened, I was debating what to do.  When the computers arrived, I locked the unopened boxes up, because I expected that the purchase was going to come back and bite me.  At this point in time I am unaware of the paypal credit account.

 

About a month later, someone in my company forwarded the paperwork they sent to the billing address,.  HUGE surprise.  I immediately returned the computers, eating the return fees personally.  I then corrected the billing address, and re-ordered the computers so that they would be correctly billed.  I explained to the computer company what had happened, but they couldn't help me move the charge to the correct account, so the return/reorder was the only possible resolution.

 

After it was all corrected, I considered my options with the account.  In the end I decided to keep it, as it would improve my credit, right?  I'm trying to buy a new house next year, so improving my debt ratio is a good thing!  As me and my wife were working through the process of deciding what we were going to do with regard to buying a house, we were checking our credit constantly.  The hit from thre paypal credit account creation was the first thing I noticed, but I fugured that they would start reporting soon.  I used the account a whole bunch for a while, thinking that the card being active is more likely to start reporting sooner than later...  Here I am 10 months later, and I'm finding that they are not reporting, and that they will never report (unless I fail to pay).

 

Now someone told me that Paypal doesn't report to the bureaus at all.  I happen to know that is not true at all.  They do a hard query when you apply, and if you go deliquent they report that to the bureaus.  They don't do anything to help your credit, but if you are late with a payment they will in fact ding your credit.

 

I just asked then to close my account tonight.  Too much risk, and zero reward.  I can open up a "real" credit line elsewhere that will reward me with good credit for paying.  Sure, all credit accounts have risk, but when they report your good status and unused credit to the bureaus, it mitigates the risk.  Paypal credit is not mitigating the risk.

 

Now that isn't always a bad thing, but it is up to you on how much uncompensated risk you want to be exposed to.  For me, it is zero.



I have a background in mortgage and credit and just discovered the no reporting that PayPal does.   Here are the rules... (and they know em)  IF a company reports the "bad"  they have to report the good if you ask them....they do not have to automatically do it.  But I just called them and they do not report either.... if you are late they turn it to collections and that company will report it.  So they are junk to me..... and deceptive but savvy about it.  Some used car dealers do a similar thing... never report the good payments so you have poorer than you deserve credit and guess who you have to get your next loan from because of it.  

 

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OhSeanO
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Contributor

BuilderUpJack
New Community Member
I've been seeing this question around for a while, so I thought I could help shed some light on this topic. I have for years been wondering this same thing and wish it would change, since reporting my current credit line with PayPal would help my credit score significantly. But is it really worth it? According to the credit bureaus, a big chunk of your score is based off credit usage. With that in mind if you really needed to make a large purchase and had to max out a credit card, your credit score will take a hit from this regardless if your credit usage was still low, since a percentage of your credit score is based on individual credit accounts as well as them as a whole. Having PayPal as that big purchase line of credit then you will never have to worry about that. No, despite how well you handle your account it wouldn't benefit you credit wise, but it will help get you by when you need to make large purchases without it affecting your credit score. Not only that, if you spend over $100 you have 6 months to pay with no payments or interest. This little deal is around all year long and as good as it's going to get compared to the store cards you get. Now look at it from PayPal's side. PayPal I'm sure already understands how this works and know that if their credit lines were used mainly to help build credit then people would use it less and in return affect their profits from the interest charges. It's actually a smart move on PayPal's part and a heaven sent credit line that I don't ever have to manage when it comes to maintaining a certain balance. My only concern is affording the payments or even my ability to pay off the outstanding balance in full at the end of 6 months without a payment. Take advantage people. Use the traditional credit cards to build your credit and just hold on to them for the small things. Use PayPal for the big and never have to think twice when making that purchase even if your a week from closing on a mortgage.
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