Credit Karma Review, How Reliable is Credit karma?

Debt usage determines 30% of your credit score. The better you handle your debts, the better your credit score comes out. This is the goal of Credit Karma, a company based in San Francisco, that offers free credit scores for its consumers. The information from credit scores can guide Credit Karma users into better credit health by monitoring the effects of their financial decisions on their credit scores when the change happens, and adjust their actions accordingly.

Completely Free Credit Score

To write Credit karma review, I signed up for their account. The process is extremely smooth. yes, there is a risk involved when you give out your social security number to a third-party who’ll store it in their database.

I couldn’t find any info on net about this score being stored in encrypted form, though I like it stored that way. Hackers can virtually crack any company database. When they get access to  it, they would definitely try to sell it to scamsters and fraudsters. Who is turn would at least try to steal your identity.

I took a risk just to write credit karma review. To check how reliable is their service offering. The same way I did for Credit Sesame Review.

The Free Credit Score from Credit Karma

Credit Karma computes your TransRisk credit score from information from TransUnion, the TransUnion Auto Insurance Risk Score, and the Vantage Score. This service Credit Karma gives for free – so you can see the updated credit score at any given period.

The TransUnion figure is the degree of possibility that you will be delinquent in your loans, or be unable to pay the complete debt at all. This data is based on historical trends and what you as a lender, has behaved with your debts. Upon signing up with Credit Karma, you will be able to see your history daily, giving you more data on how to behave in the future.

To Credit Karma’s credit and professionalism, the computed credit scores are often close enough to the official FICO scores. Some margin of error is allowed, so the Credit Karma scores may not portray the exact picture – but for a free tool, Credit Karma does fine.

The Terms of Use

Whenever giving your personal credit information, the best precaution is to read the Terms of Service, or in the case of Credit Karma, the Terms of Use of its website, and not rely on any other recommendation from an unrecognized authority on the Internet. You could do much worse by having a lawyer go through the Terms of Use, but your own analysis can suffice.

What is refreshingly appealing with the Credit Karma free service is that Credit Karma does not keep any of your private information. The information you give may be used for further analysis by Credit Karma, such as your credit score history for your TransUnion score, but your private information, Credit Karma does not store on its servers. It is a purely online free service with no grand designs to hold on to your information for other purposes than for you to bring your credit score to better financial  states.

The Business Model

Credit Karma does not earn from your private information. The business model of Credit Karma is to send targeted advertisements in your direction, and from the advertising proceeds, Credit Karma is able to give you the free credit scores.

So look at it this way. The close the Credit Karma estimate is to your FICO credit score, the more often you will return to the Credit Karma website. The more often you go to the website, the more advertisements Credit Karma will send you. And with more targeted advertisements, the more Credit Karma earns, so that even better service can be given to you.

Credit Karma is a performance-based website offering a free service. The better Credit Karma guides you to better financial health, the more it earns. The poorer its service, the less rewards it makes. This arrangement between Credit Karma’s service and revenues is ideal – for certain, no other vested interests can come between you and Credit Karma’s desire to get you to the credit score that you want. Your relationship with Credit Karma is free, the same way Credit Karma offers the service for free, and let the advertising keep

The benefits of Credit karma

You can check your credit score as many times a day as you wish. It’s free to use. There is a simulator which you can play around and simulate hypothetical situation and measure the impact to you credit score.

Completely Free Credit Score

It clearly demonstrate how paying off your credit card each month increases your credit score. It will also demonstrate how app;lying for a new credit card reduces your score.

We are giving a “Caution” rating on credit karma. apply your own logic before giving them your social security number. It hs a risk of theft as I told in the first section of this post.

Some other reviews you might be interested in

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Disclaimer: Finance Product Reviews is an independent website. Although we may have advertisement relationship with financial institution we review, they do not influence our decision or rating of products. Contents of this site are not provided by any financial institution, banks, brokerages or credit card issuers. Opinions expressed here are author’s alone and are not reviewed, approved or otherwise endorsed by the product owners.

Disclosure of Material Connection: Some of the links in this web site are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”
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20 comments to Credit Karma Review, How Reliable is Credit karma?

  • [...] Credit Karma Review, How Reliable is Credit Karma? [...]


  • [...] Credit Karma Review, How Reliable is Credit Karma?: Finance Product Reviews [...]


  • Dear Financeproductreviews,
    Thanks for the info, With so many credit repair services out there, credit repair reviews are a great place to research which one is right for you. It’s important to find reviews that are written by credit experts and done based on solid facts. Although many of the credit repair scams have been shut down by the FTC, it is always a possibility that more will pop up. There are easy ways to avoid such scams with a little research.


  • Thanks for the review! I wanted to clear up just one thing: We don’t calculate the credit scores; they’re actually calculated by the credit bureau. We provide you with the scores for free and try to break them down to help you better understand what factors contribute to them. To address your security concerns (totally understandable), you might find this blog post helpful: Is Credit Karma Safe?


    • admin

      Thanks for pointing that out to readers, I should have re checked it once more. Thanks for sharing the link..but yes if Microsoft and Citi can be hacked, any can be.


  • [...] @FPR from Finance Product Reviews presents Credit Karma Review, How Reliable is Credit karma?, and says, “Review of Credit Karma service offered through their web site. Covering every [...]


  • I couldn’t resist commenting. Very well written!


  • [...] @ Finance Product Reviews writes Credit Karma Review, How Reliable is Credit karma? – Creditkarma is a tool which let you see your Transunion credit score for free, but how [...]


  • Tammy

    This looks awesome! I friend of mine told me about the app for my IPhone. I have a question…when I ask to see my score, is that a hard or soft pull on my credit report? What is the impact of the inquiries on my score?


    • admin

      Credit karma doesn’t give your actual FICO score, its a near-simulation of actual scoring system. SInce there’s never an inquiry in to your actual score, your score remains unaffected. Also self-checking credit score is always a soft pull.


  • Joe Gallagher

    Credit Karma is a shill for Citi


  • Joe Gallagher

    I Registered for Credit Karma. When I went to the ‘Savings’ page I found some surprises, to say the least. Three different specific dollar amounts of savings were proposed for following recommended actions based on the information I provided:

    1) Refinance my auto loan from 48 months to 60; almost double the interest rate, for a lower monthly payment. That lowers my monthly payment, it does not save me money; it costs me money.

    2) Add a credit card. The simulation page where I try different actions to see the effect on my rating says that adding a credit card would harm my rating. Further, how would simply adding a cc save money?

    3) Lower my auto insurance by a significant amount. There is no information on which to base that. CK does not know who I have auto insurance with, nor what I pay, and there would have to be at least one quote to come with such a dollar amount of savings.

    Throughout the site there are suggestions for various financial instruments I might use to to better my credit score, the majority of which are Citi products, including the suggested credit card accounts I might open to that end.


  • Duke

    I would like to say a big thanks to credit Karma.I now understand my score and can make some meaning out of it.I will visit this site every week to know whats going on.Thanks.


  • Paula Lane

    I have to wonder about Credit Karma. At first, I thought it was a good idea…It is a good way to keep up with your credit score…but the thing is, they give you tempting choice options..such as open new credit accounts to ‘save money’..(transfer balances, etc) …then when you do get a prime card and transfer your balances, they lower your credit score substancially! Doesn’t matter if you make your payments on time or that they see you are trying to get away from sub prime credit, ….they make it very hard to keep your prime credit by lowering your scores. Just doesn’t make good sense to me.


  • ap999

    Its good tool to monitor your score often. But do not be fooled by their suggestions in how to save on interest, credit card offers, loan offers etc. Those are just advertisements to cover their free service, thats how they make money and maintain the site. Do your own homework when it comes to taking them up on any offers.

    I have zero debt and a 789 score according to creditkarma. They always show my current credit card balances on there throughout the month. They count this as “debt” and start offering up other cards for balance transfers. The fact is I pay my card in full well before the due date. So basically I do not pay any interest to my card companies. But they still offer these up, probably assuming it might revolving debt when its just actually current debt, that is paid before the due date, then finally goes back to zero and so on for the next month.


  • [...] Credit Karma Review, How Reliable is Credit karma … – Credit Karma is a performance-based website offering a free service. The better Credit Karma guides you to better financial health, the more it earns…. [...]


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Disclosure of Material Connection: Some of the links in this web site are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”