Credit Karma Review: How to Get Your Credit Score for Free

A safe, free, and reliable way to obtain your credit score as often as once per week?

It sounds too good to be true, but San Francisco startup Credit Karma can do just that for you. While your free credit report has always been available to request once per year, up until recently consumers couldn’t access a free version of their credit score.

Having access to your credit score on a regular basis can help you guard against errors. It can also alert you to issues within your personal finances if you see your credit score slipping. As XYPN advisor Sophia Bera pointed out on a recent blog post, your credit score is like your financial report card.

Bad "grades," or a lower score, can be indicative of bad financial habits that need correcting. Checking your score more than once per year can increase your awareness and help you get back on track before you take on any serious financial damage.

So is Credit Karma worth it? Is it legitimate? And should you use it yourself?

Pros and Cons of Credit Karma

Your credit score is a helpful tool for better understanding your big financial picture. Being able to use a service like Credit Karma can provide insights to your credit and help you understand where you stand with financial institutions before approaching a lender for a service or product.

The site is legitimate, but there are still issues to look out for and understand before using the service to check your credit score.

First, realize that the score the site provides is only one score (from TransUnion) and it’s not the FICO score that lenders are looking at when they run your credit. That’s not necessarily a bad thing – based off the score Credit Karma provides, you could reasonably estimate that your FICO score is in the same ballpark. But it won’t be the exact same.

Second, recognize that the site doesn’t run off goodwill. The company is for profit and makes money by serving up ads or offers from partner companies. Again, it’s not necessarily a bad thing as plenty of businesses earn money from advertisements. You simply need to be aware that the sweet credit card offer that shows up in your inbox every once in a while is just an upsell and not an exclusive deal that will benefit you.

Finally, Credit Karma isn’t a substitute for pulling your annual credit report for free each year. It’s a great accessory to your full credit report, so ensure you’re taking advantage of both. (You can pull your credit report once per year at AnnualCreditReport.com)

Our Credit Karma Review

We sent an XYPNer off to try out the service and report back with a Credit Karma review so you know what to expect before trying it for yourself:

Signing Up

Getting started with Credit Karma is easy enough. On the sign-up page, they remind you that signing up is truly free. They also point out that checking your credit score with them will not affect your credit; it's a soft inquiry. Good to know.

The sign-up page also gives you an option to opt out of receiving  promotional offers in your inbox. However, you must agree to receive updates to your credit report via email before Credit Karma allows you to continue with the sign-up process.

The next step is the scary part: lots of personal information. You need to put in your name, address, phone number, birthday, and the last four digits of your social security number. A small message does pop up as you're entering your SSN that's pretty reassuring: Credit Karma does not store your information on a database and it's only used to pull your first credit score.

If Credit Karma cannot find your score based on the personal information and last four digits of your SSN, you'll need to type in your full SSN -- and this comes with another message with more details on how they keep your information secure.

The final step: verifying you are who you say you are. You'll be asked a few questions that you need to correctly answer before the sign-up process is complete and you can get your score.

The Credit Score Center

Once you've successfully signed up, you're whisked away to a page that is absolutely full of information. Here's what my dashboard looks like as I scroll down the page:

• My TransUnion credit score: it gives me a specific number between 300 and 850 and also tells me what my rating is based on my score.
• A nice little offer for a Discover credit card. Let's keep scrolling.
• A summary of my credit report activity, along with records of things that factor into your credit score (like length of credit history) and an associated grade for each.
• Another ad, but this one for credit protection monitoring services from TransUnion.
• A "see how you compare" section that tells me what percentage of Credit Karma users have a lower score than I do. If I want to compare myself in more detail, I can modify some perimeters and compare myself to people in certain states, age groups, and income levels.

I can also view a credit report card, which breaks down the factors that affect your score and gives you a grade for each.Again, I have options to compare myself to the rest of Credit Karma's users. There's also a "full" report card that is in beta mode and goes into more detail -- including a map that puts little pinpoints on all your reported addresses. A little creepy.

I can then use the credit score simulator to check out "if this, then that" types of scenarios. You can see what a particular action is likely to do to your credit score, which is helpful if you're considering taking out a new credit card but aren't sure of the impact that has on your score.

Other sections on the main page include a list of your lines of credit, including credit cards and loans. You also have a helpful "My Recommendations" page which is a curated list of "special offers." Don't even bother clicking here.

Other Scores

In addition to my credit score, I can look at a few other metrics. These include:

• My VantageScore. According to Credit Karma, this is a model "created through a collaboration by the three major credit bureaus: Equifax, Experian and TransUnion. It aims to make credit scoring more consistent and accurate across all the bureaus. The VantageScore grades your creditworthiness on an easy A to F letter scale." Your score will range from 501 to 990.
• My auto insurance score. This is a score that ranges from 150 to 950. It's "calculated using data from your TransUnion credit report and is used primarily by auto insurance companies to help assess the likelihood that you'll file an insurance claim." But apparently this isn't based on my driving record.
• My home insurance score. Same idea here, and same scale.

Deleting Your Account

If you decide that you no longer want your Credit Karma account, you do have the option to delete it. Here's how:

• Go to the Contact page.
• Under "How Can We Help?" click on the drop-down box and select "canceling my free membership."
• You'll then receive an option to get started with the cancellation process. Be aware that if you cancel your account, you can't sign up again for six months if you change your mind.
• Confirm that you want to cancel the account; you'll then receive a confirmation notice that it has been canceled. Then you're done!

Credit Karma Review: Conclusion

Credit Karma seems like a great service for keeping a finger on the pulse of an importance piece of your personal finance picture. It provides you with a lot of information that not only answers, "what's my credit score?" but also helps you to understand what determined that score.

Of course, any service like this can leave users wary -- you're required to provide a lot of personal information. But I did appreciate how easy it was to delete an account (although that doesn't mean my information was automatically and securely wiped away).

But an even bigger drawback was the abundance of special offers and ads. That could get some users in trouble, so have your guard up when on the site and don't be lulled into applying for credit cards or other products you don't need.

Ultimately, Credit Karma seems like a good tool to have at your disposal. It allows you to check for errors much more frequently than just once a year, and allows you understand your credit score in a complete way.

Do you still have questions about Credit Karma? Let us know in the comments below!