This San Francisco based company, has been featured in multiple news articles including MSNBC, SmartMoney, The Wall Street Journal, USA Today, and TechCrunch. Credit Karma is committed to providing consumers with the free resources and information they need to take control of their financial health. Beginning with a free credit score and report, the heart of personal finance, Credit Karma brings more transparency and certainty to credit and finance with free monitoring, data-driven resources and personalized recommendations.
Credit Karma offers basic credit education and monitoring for their members without a subscription charge. They have a number of features which are designed to help their members make more educated financial decisions, specifically about their debt and credit cards. The company’s revenue is derived 100% from partnerships with financial companies which pay Credit Karma a percentage of all business from the new accounts, etc. which comes as a result of Credit Karma members using these services.
Credit Karma has several helpful tools for their members which include ways to simulate changes to one’s credit score with different behaviors (paying down debt, adding a new credit account, etc.), a mortgage calculator, and debt repayment calculator.
Credit Karma has mobile applications available for Android and iOS which allow members to track their credit from their mobile device.
Credit reports and scores offered on Credit Karma are refreshed weekly and members enjoy daily credit monitoring by TransUnion. Members do not receive all three credit reports when signing up for a membership with Credit Karma. They receive their Equifax and TransUnion reports and scores for all three credit bureaus.
There are a significant number of complaints against Credit Karma with the Better Business Bureau. The company attempts to respond and solve these complaints, which usually involves some education about the company and its services. There is no customer support available via telephone, which is problematic. The fact that customers are taking the time to complain with the BBB for a free service merits examination and consideration.
There are several anecdotal reports to an increase in the receipt of postal junk mail and SPAM after signing up for a free Credit Karma membership. While the company states that they do not and will not sell their members’ private information, members also agree to being contacted by Credit Karma and their partners, which would increase the amount of solicitation by external companies by definition.
Credit Karma has had their problems with their mobile apps as well. In March, 2014, the Federal Trade Commission accused the company of violating their member’s rights to privacy in that their apps were not secure. There were no reports of parties being injured by the lack of security, but the FTC found that the applications were not as secure as the company led their members to believe. As such, the FTC and Credit Karma entered into a settlement, which has since been approved by a Federal judge stating that the problems must be addressed immediately (they have been) and that the company must submit to annual independent tests to verify that the apps are secure for the next 20 years.
The Bottom Line
One can save hundreds of dollars on credit monitoring services by using Credit Karma. Their approach is unique to the industry in that they don’t charge high monthly subscriptions to their members. For the most part, the credit reports and scores are quite similar to that which is offered by paid credit monitoring services. Credit Karma offers their members reports from 2 of 3 of the major credit bureaus and their Vantage 3.0 score. Credit Karma refreshes their members’ credit reports weekly, which is unusual for the industry.
There are significant concerns about the state of ongoing privacy with the mobile apps however, and the lack of telephone support is a glaring absence. The very fact that nearly 300 complaints have been filed with the Better Business Bureau during the last 3 years is interesting as far as Credit Karma offers a free service.
One should evaluate carefully and assess the weaknesses and strengths for Credit Karma and make an educated decision before signing up for a free membership.
Credit Karma is free for all members and never requires a credit card.
Credit Karma does not offer trials. The service is free to all customers.
Scores & Reports Provided
Credit Karma offers each member a copy of their Equifax and TransUnion credit reports, scores from all three major credit bureaus and their Vantage 3.0 score.
Credit Karma does not offer assistance in error dispute. Members with errors on their credit report(s) need to contact the credit bureau(s) directly.
Credit Karma send members alerts when their credit score or reports change which can be seen in their member profile.
Credit Score and Report Refreshes
Credit Karma offers their members weekly updates to members’ Equifax and TransUnion credit reports and scores.
Credit Karma uses 128-bit encryption for their website and protects the transmission of customer data to their site. Their data center is staffed 24/7 with security personnel.
Important to note is that in March, 2014, Credit Karma entered into an agreement with the Federal Trade Commission to address the security of their mobile apps (Android and iOS). The settlement included the company’s acknowledgement that they did not take proper and appropriate steps to ensure that their mobile apps were secure and could transmit sensitive consumer data over a non-secure channel. Credit Karma made adjustments and their apps were certified to be secure. The company must comply with annual security checks of their mobile apps for the next twenty years to verify that the apps remain secure.
Identity Theft Protection
Credit Karma does not provide identity protection beyond a customer being able to self-monitor their credit reports for changes which can signal that they may have been a victim of identity theft. They do not offer identity protection insurance at this time.
Alerts for members of Credit Karma are sent to the member’s online profile. These are not sent via SMS or email at this time.
Better Business Bureau Score
Credit Karma is not accredited by the Better Business Bureau and has a rating of C+. The company has received many complaints in the last three years which were filed with the BBB – 282 complaints were filed in the last three years, with 108 of them being filed in the last 12 months. These complaints are balanced fairly evenly between problems with the product, advertising, and warranty. Being that the company offers a free product, it is significant that there are such a large number of complaints which members felt the need to go through the process of filing complaints with the Better Business Bureau.
Time in Business
- (415) 692-5722
- PO Box 520, San Francisco, CA 94104-0520
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