Knowing your credit score gives you a picture of your financial health. From qualifying for loans and accessing competitive interest rates, a solid credit rating helps you achieve financial wellness.
Credit Karma lets its users access their credit score free of charge – but is it worth it? Is it really free without any constraints, and is it beneficial for users, even if they have good credit?
After asking those questions and extensively reviewing the product, I’ve found that Credit Karma is an invaluable resource for those looking to keep their financial health in check.
If you’re looking to access your credit score or frequently monitor it, I’ll break it down here in this Credit Karma Canada Review
Free Credit Score Monitoring
If you’re looking to check up on your credit, Credit Karma offers a free credit report along with credit monitoring.
- Free to use
- Explains reasons for score and factors affecting it
- Provides educational material to improve score
- Website is user friendly and easy to understand
What Is Credit Karma?
Credit Karma allows users to access their free credit score and report, something that wasn’t always offered free of charge in Canada. The company is based in the U.S. but expanded to their Northerly neighbour back in 2016.
Credit Karma also offers credit monitoring and can provide additional services like credit cards and personal loans. That’s actually how the company makes money. If you sign up for one of these cards, the issuing bank pays a referral fee to Credit Karma.
If you’re concerned about your credit history or are looking for some good credit card options based on your score, Credit Karma might be a good option.
Credit scores are incredibly important when you’re looking to secure a loan with a competitive interest rate. Knowing your score ahead of time and ways to improve it can keep you from paying thousands more in annual interest.
Considering many Canadians had to pay at least $20 several years back to secure their credit report, a site that offers these services for free is always a win for users.
From Credit Karma’s own website, they claim you’ll never get charged for their services – even if you don’t want one of their recommended credit card options.
Offers Tips to Improve
While knowing your credit score is a great first step, if you have bad credit, finding ways to improve that score is even more important. Credit Karma offers ways users can elevate their score and even gives explanations on certain factors that contribute to the overall score.
The company’s website contains a whole “Articles” section that features common questions and scenarios users might find helpful.
Data breaches and identity theft are regular occurrences these days. To help give you peace of mind, Credit Karma offers free credit monitoring services to its members. The company notifies its users whenever a hard inquiry pops up on their credit report.
This allows members to monitor their financial information and take any necessary steps against a further breach.
To access your credit score, you need to divulge personal data. Credit Karma makes sure to keep that pertinent information safe by using firewalls, advanced encryption, and enlisting third parties to guarantee the safety of their site.
The website is easy to navigate and provides simple-to-read information, along with graphs and a credit report card. You can see how your credit score compares to others your age and shows you how your payment history affects your overall score.
While the setup is straightforward, it can get tiresome going through the barrage of financial advertisements aimed at you. While it’s how the site makes its money and might include some good deals, it still can get frustrating to navigate.
While you might stop by to check out your credit score, Credit Karma hopes you’ll take a look at their additional services.
The company offers:
- Credit cards
- Personal loans
- Mortgages, including refinancing
Credit Karma offers a slew of credit card options, breaking them down into the following categories:
- Low-interest cards
- Balance transfer cards
- Rewards cards
- Cashback cards
- Build credit
Your credit score is obtained from two of the major credit bureaus in Canada. In this case, it’s TransUnion and Experian. The scores may not be the same, and that’s common, not something to worry about.
The reason for the differences is that not all lenders report to each credit bureau, and both have different scoring models that can yield different results.
According to the Credit Karma website, updates to credit scores occur about every seven days from TransUnion. There should be a spot near your credit score that lists your last update and when the next one should hit.
While your information may change on Credit Karma, it might take longer to see a difference in your credit report since it usually takes 30 days or so for creditors to send updates to the credit bureaus.
No! Checking your credit score is free and can give you insight into your financial health. Your credit score helps determine interest rates and loan approval, so it’s important to know that number.
In addition, if you have bad credit, there are ways to improve it, but you first need to know your financial position before you can get started.
Borrowell is very similar to Credit Karma in that it allows users a free monthly credit check. The company partners with Equifax to check credit scores, whereas Credit Karma uses TransUnion.
In addition to credit checks, Borrowell provides credit monitoring services, credit card offers, and personal loan and mortgage services. All are comparable to Credit Karma.
Borrowell does offer Borrowell Boost, which links up your bank account and helps manage cash flow. The app can send alerts for when bills are due, helping to eliminate late fees.
Borrowell also features an AI credit coach, Molly. Molly provides tips to improve your credit score and shows you the factors that currently affect your score. While Credit Karma doesn’t have a separate coach, it provides similar services to Borrowell’s Molly.
Ultimately, the biggest difference between the two is that Borrowell gets its data from Equifax and Credit Karma gets it from TransUnion. Other than that, they both offer similar services
If you’re looking for more information about Borrowell, check out this review I did of the company. It might help you decide between the two.
Mogo offers similar services – free credit scores, personal loans, and mortgages but has extended services that Credit Karma doesn’t. Mogo offers free identity protection and a no annual fee Mogo Platinum Prepaid Visa card.
In addition, Mogo offers a cryptocurrency exchange, something neither Credit Karma nor Borrowell has.
Users were split down the middle when it came to Credit Karma. While many appreciated the free service and recommendations, others were frustrated that their scores were quite a few points off compared to the banks.
Here is a five-star and one-star review via Consumer Affairs that shows the span between reviewers. Ultimately, it seems like you either love or hate the company, there aren’t too many in between
Is Credit Karma Legit?
Even though it sounds too good to be true, Credit Karma is a legitimate business. They’re based in San Francisco, and since many people find it suspicious for a company to offer a free credit report, Credit Karma took to their website to explain their platform.
How to Sign Up for Credit Karma
You can sign up for your free credit report via Credit Karma’s website. You’ll just need to set up an account and provide some personal information. Contrary to popular belief, accessing your credit score does not lower it.
An inquiry that you make of your credit is called a “soft inquiry” and doesn’t affect your score.
Once you obtain your score, you’ll have access to certain graphs and simulations that show your score over time as well as what happens when you pay down debt, get a new credit card, or curtail using a credit card.
Each of these situations affects your overall score, and with Credit Karma, you’ll be able to closely monitor each change.
If you’re looking to keep tabs on your credit or find ways to improve your score, Credit Karma offers a free credit report and continuous monitoring for your peace of mind.
The company also helps educate you on the factors currently affecting your score, as well as ways to boost it. A user-friendly website makes it easy to understand and perfect for those looking to improve their financial health.
If you’re wondering why a good credit score is important, check out these ways how it can improve your life.