How Accurate Are Credit Karma Scores?

Curious about your credit score? Then you may be wondering about Credit Karma. The personal finance website promises to help you manage your finances and offers a free credit report and score to encourage you to register for a free account. But how accurate are Credit Karma scores? Keep reading to find out. 

What Is Credit Karma?

Credit Karma is a financial technology, or “fintech,” company that provides a wide range of free services to help consumers better manage money and improve their credit. Its parent company, Intuit, also owns QuickBooks personal finance and accounting software, TurboTax tax software, and the personal finance app Mint.com. Credit Karma earns money from ads on the site and when users buy products or services it recommends.

What Does Credit Karma Offer?

You can get a free credit score and credit report from Credit Karma in exchange for providing some personal information. Your credit score will be calculated using the VantageScore 3.0 credit scoring model. Credit Karma also offers a wide range of other free services. For instance, you can access tools and education, such as financial calculators and useful articles, so you can learn how to make the most of your money. Based on data you share, Credit Karma makes recommendations for managing your finances.

Looking for an auto loan, home loan, credit card or other credit product? Use the site to get personalized recommendations for loans and credit cards that fit your credit profile. Credit Karma also offers free credit monitoring, which includes alerts of important changes to your TransUnion credit report; this can help you spot identity theft.

What Is VantageScore?

The VantageScore and FICO Score are the two major credit scoring models. A credit scoring model is software that analyzes data about your use of credit to calculate a numerical score indicating your creditworthiness. Lenders use this score to help decide whether to extend you credit. Credit scoring models are regularly updated; for example, there are currently four versions of the VantageScore, with the most recent being VantageScore 4.0.

FICO vs. VantageScore: Which Is Better?

One credit score isn’t “better” than another. However, some 90% of credit decisions are made using a FICO Score. The FICO Score has been around since 1989; there are dozens of versions of it. Here’s a rundown of the differences and similarities between the two credit scoring models.

Differences Between FICO and VantageScore

In addition to the “base” FICO Score, of which the newest versions are FICO Score 9 and 10, FICO offers industry-specific credit scoring models designed for creditors such as auto and mortgage lenders. VantageScore does not have industry-specific credit scoring models.

There are also different FICO Score models for each of the three major consumer credit bureaus (Experian, TransUnion and Equifax). Each of the four VantageScore models can be used by any credit bureau.

To have a FICO Score, your credit report must show at least one credit account at least six months old and activity on at least one credit account during the last six months. To have a VantageScore, all you need is one credit account on your credit report, no matter how new the account is.

The two credit scoring models weigh the data in your credit report somewhat differently. For instance, payment history is more important to your FICO Score than to your VantageScore; credit usage and credit mix are more important to your VantageScore than to your FICO Score.

Similarities Between FICO and VantageScore

Both the FICO Score and VantageScore models use a credit score range from 300 to 850. Both consider the same general factors when assessing your creditworthiness: your payment history, how much credit you’re using, the length of your credit history, the different types of credit you have (such as loans and credit cards) and whether you’ve recently applied for new credit.

How Accurate is Your Credit Karma Score?

Your Credit Karma score, which is generated using the VantageScore model and data from TransUnion and Equifax, is updated every week, so it should be accurate. Keep in mind, though, that your score’s accuracy is affected by whether your credit report is correct. To make sure your credit report is current, you should check your credit report with Experian, TransUnion and Equifax at least once a year. You can do this for free at AnnualCreditReport.com. If you find anything inaccurate, you should file a dispute with the credit bureau.

Why Is Your Credit Karma Score Different From Your FICO Score?

Your Credit Karma score is generated with the VantageScore credit scoring model, which weighs information in your credit report slightly differently than the FICO Score model. The two scores should be similar, but they’re unlikely to be the same.

Credit Karma Limitations

Before you use Credit Karma to check your credit score, it’s important to be aware of a few limitations.

Your FICO Score May Be Different

Credit Karma shows you your VantageScore 3.0. Most lenders use the FICO Score 8. Although your VantageScore and FICO Score will generally be similar, they won’t be exactly the same; in some cases, there can be significant differences. If you are applying for a major loan, such as a mortgage or auto loan, it’s a good idea to check your FICO Score.

Credit Karma Score May Be Insufficient

Because your Credit Karma score is a VantageScore, it may not give you the complete picture of your credit. Checking your FICO Score as well is a good idea if you’re planning a big purchase, such as buying a home.

Credit Karma May Encourage Borrowing

Although Credit Karma offers valuable free services, it also recommends financial products and services such as credit cards or loans. If you purchase these products, Credit Karma gets paid. Seeing ads or getting product recommendations might encourage you to take out loans or apply for credit cards that you don’t really need, which could increase your debt load. 

Alternatives to Credit Karma to Check and Monitor your Credit Score

You can check your credit score in a variety of ways. For example, your credit union, bank or credit card issuer might offer a free credit score. Other third-party sites besides Credit Karma also provide credit scores.

Credit bureaus also offer credit scores, but there may be a fee. You can pay to get your VantageScore from Equifax or TransUnion. MyFICO.com offers FICO Scores for a fee. Experian provides your FICO Score 8, the score the majority of lenders use, for free.

Monitoring your credit can alert you of suspicious activity and show you how your use of credit affects your score. TransUnion and Equifax offer paid credit monitoring services. Experian Creditworks is free and gives you monthly access to your Experian credit report and FICO Score. There’s also a paid version that includes access to FICO Scores and credit reports from all three credit bureaus monthly, and to Experian credit reports and FICO Scores daily.

FAQ About Credit Karma

Still have questions about Credit Karma? Keep reading.

Is Credit Karma really free?

Credit Karma is free to use; simply provide some basic personal information, including the last four digits of your Social Security number.

Does Credit Karma hurt your credit?

Checking your own credit score and credit report on Credit Karma (or through any other avenue) will not hurt your credit. Your credit score may see a temporary dip when you apply for credit and the lender checks your credit report (known as a hard inquiry). Checking your own credit score is known as a soft inquiry, which does not affect your credit score.
Credit Karma could boost your credit if its educational tools and credit monitoring services help you improve your credit score. On the other hand, if the site inspires you to take on excessive debt and you fall behind on the payments, your credit could suffer.

Can you get my FICO score from Credit Karma?

Credit Karma does not provide a FICO Score; it provides your VantageScore 3.0. You can get a free FICO Score and free credit report from Experian. You may also be able to get your credit score from your bank or credit card company, but you’ll need to clarify whether it is the FICO Score or the VantageScore.

Is Credit Karma score lower than FICO?

Since the VantageScore and FICO Score are different credit scoring models, it’s possible your score on Credit Karma (a VantageScore) could differ from your FICO Score. Your score might also fluctuate depending on which version of the FICO Score or VantageScore is used or on which credit bureau’s data is used. CreditKarma uses credit reports from TransUnion and Equifax but not from Experian. The three credit bureaus may not have the same information about you, which could affect your credit score.

Is FICO the most accurate credit score?

Credit scores can differ widely depending on the credit scoring model used, the credit bureau whose information is used, the accuracy of the information in your credit report, and the date the credit score is generated. Credit scores fluctuate all the time, so rather than fixating on a specific number, focus on monitoring your credit score range. Keeping an eye on both your FICO Score and your VantageScore will give you the fullest possible picture of your credit profile and how you can improve it. 

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