Your credit score is an important factor that will determine your credit worthiness. Thus, it is important that you should be aware of your credit score. Anyone who wishes to keep track of their credit score can do it the old fashioned way—through the 3-company reporting system. But there are newer methods introduced every year. Credit Karma offers the service of easy checking and access of one’s credit score.
What is a Credit Score?
A credit score is a numerical value (from 150 to 999) given based on how you handle your credit for the past years. This value lets banks and creditors determine if you’re worthy of a loan or not. Therefore, the higher your credit scores are, the more chances you’ll have in obtaining a loan. But its purpose is not only loan application, but your credit score determines how much interest should you pay.
Credit Scores are derived from your credit activities—from payments to loan applications. If you pay your debts fully and on time, then you can expect your credit score to be higher. Fall behind on your payments (or default on your loans) and your score takes a hit.
3 companies take charge in keeping track of your credit score. These are: Equifax, Experian, and Transunion. All 3 companies have their own method of obtaining your credit history and activities. This means that your score for one company might not be reflective of the other, given their different methodologies. What most banks and credit firms do is to take the median score to determine the credit score they will use.
Credit Karma Pros
Let’s start reviewing Credit Karma by highlighting their good points:
• Offers online services—they do away with paper report, which is being sent through the mail. Instead, you can get your credit score through their website. It’s more convenient and environment-friendly.
• You can check your score anytime—you don’t have to wait for that time of year when you get your annual credit report. With Credit Karma, all you need to do is to log on to their website and you can take a gander at your current score.
• They have tips and strategies to improve your credit score—Credit Karma goes the extra mile by giving advice to their clients on how they can increase their current score. They show their clients a breakdown of their credit score through metrics. Together with these metrics are tips on how one can better improve on his score.
• It’s completely free—you don’t have to pay a cent for you to obtain your credit score with Credit Karma.
Credit Karma Cons
With Credit Karma, you only get one credit score report (instead of 3) from Transunion. This means that what you’re getting is just a glimpse of your true score because the report is deemed incomplete. However, you can’t expect much for the service given by Credit karma is free after all. If you need a complete report, it is better to go for paid services.
Also, Credit Karma asks for your social security number when accessing your financial information. This may be a cause of alarm to people who are not comfortable disclosing their personal information.
Conclusion
If your credit activities are infrequent, which means your scores do not change much, then it’s a good choice to sign up with Credit Karma. Their online service is certainly an upgrade over the paper report you receive yearly. And the great part is that it’s all for free. However, if you need to have the most accurate and up-to-date credit score, then you might be better off with the paid credit reports. These paid reports can give you all three scores from the different credit report companies.
Go ahead and try the services of Credit Karma. You don’t need to worry because you don’t have to pay anything when you sign up.
For more financial advice and tips, head on to CrockTock.com where you will find nuggets of information that will help you make the most of your hard earned money.
– Brittney Marie Chan
