Buy Now Pay Later services like Klarna and Affirm are quietly hurting shoppers, retailers, and the broader economy, and the damage is starting to show up in mortgage approvals.

• BNPL charges stores up to 8% per sale, so retailers raise prices for everyone, even people who never use these services.
• Shoppers using BNPL buy more and spend more because paying later makes the money feel less real.
• BNPL debt does not show up on normal credit reports, so banks cannot see how much people actually owe.
• Over 53 million Americans use BNPL, often stacking multiple loans across different apps, and late payments are rising fast.
• Starting in 2026, AI tools and underwriters are scanning bank statements for BNPL activity and counting it against mortgage applications.

Outlook: BNPL use will keep dragging down credit scores and blocking home loans, and the hidden debt pile will keep growing until regulators catch up.