Credit Karma is a free credit and financial management platform which is available for US consumers. Credit Karma basically provides information of creditability of individuals in terms of credit scores, credit reports and other credit monitoring tolls which is available for users free of cost through Credit Karma web and mobile app. The website mainly make use of credit reports and credit scores by taking help from Equifax and TransUnion and posting weekly updates for their new and existing users.
Credit Karma was founded by Kenneth Lin in 2007 and has its headquarters in San Francisco, California. However its official website was live in Feb 2008 and its early investors include Mark Lefanowicz (President of E-Loan) and Chris Larson (CEO of Prosper).
How to make account on Credit Karma?
Unlike other financial management platforms such as Credit.com and Credit Sesame, the joining procedure at Credit Karma is very simple and easy. To create a verified account at Credit Karma all you need to do is to give some personal details such as name, email ID and contact no etc at the time of Signup. Once all the necessary information is given your account will become active and then you can start making use of credit monitoring tools offered by Credit Karma.
Credit Karma Benefits and Features
Credit Karma offers some of the best credit monitoring tools and expert advice to all the users regarding how they can control their excess of credit. Some of the major features and benefits offered by company are given as follows:
- TransUnion Credit Scores – With the help of this tool one can know about how their credit scores changes with the changes made in credit. The chart in this tool is continuously updated so that one can compare changes and get an overall grade.
- Equifax Credit Score – In addition to TransUnion Credit Score Report which is offered free of cost to its members Credit Karma started offering Equifax Credit score report from January 2015.
- Free Credit Monitoring – To provide more benefits to existing users Credit Karma started offering Free Credit Monitoring which help users to look after their credit in an easy manner.
- TransUnion Auto Insurance Score – With the help of this tool one can come to know how he/she can stack up against other in terms of auto insurance scores. Auto insurance scores are totally based on credit history.
- TransUnion Home Insurance Score – Just like auto insurance score, this tool work in the similar manner but it is basically used for home insurance.
- Vantage Score – Credit Karma also provides the Vantage score of an individual which is consistently and cumulative credit score of an individual allocated by all the three top credit bureaus.
- Credit Score Simulator – In spite of offering free credit scores, Credit Karma also provides credit tools like Credit Score Simulator, which shows the effect of potential financial action on the score of individual’s credit scores. This tool basically recommends how any individual can improve their credit profile.
- My Spending Tool – Credit Karma also provides My Spending Tool through account aggregation service Yodlee. This tool helps the user to track his credit card and loan transactions and balances in Credit Karma’s interface.
Credit Karma also provides data to consumer for financial product reviews and any credit related advice. It also provides calculator tools for debt repayment, home affordability, amortization and simple loans. Except these Credit Karma has introduced Fee Credit-Card, Debt-Tracking Tool also.
Is Credit Karma Safe?
What Makes Credit Karma different or Better than Others?
Credit Karma provides weekly updates of credit scores from national credit bureaus like TransUnion and Equifax. The only difference and highlighting fact is that these bureaus charge from its members for credit scores information, whereas Credit Karma provides totally free service to its members. In real Credit Karma arrange its funding from its business advertising partners.
How Accurate is Credit Karma?
As compared to FICO score which is most commonly used by all the lenders to judge the consumer’s creditability, the score obtained from TransUnion or Equifax which is used by Credit Karma have difference of just 1-2 points. This difference is even less than 1% which is very nominal does not impact much on approval of the loan at all. So the scores offered by Credit Karma are almost accurate and final.
Recent Benchmark Achieved
Credit Karma has surpassed the benchmark of 50 million members in Jan 2016. Credit Karma has additional funding of $175 million through its investors in its reserves and total funding aggregating to $368.5 million. So Credit Karma is properly funded to provide excellent services to its customers in future that too free of cost.
Credit Karma Summary
In spite of all the advantages and benefits Credit Karma has one limitation of having a bunch of offers on the website interface which can be found at the time of login session. But comparing its free uses like credit score reports, beautiful graphical display, report card, and Credit Score Simulator tool etc one can ignore minor problems easily. When compared with other credit monitoring companies which charge for the same services at the rate of $15 per month, Credit Karma is way ahead of them as it offers services free of cost. So, overall Credit Karma is customer friendly and effective.