Are Sites Like Credit Karma Safe?

Is Credit Karma reliable? Yes, the site protects users' data.

There is power in knowing your credit score and the information found within your credit report. Unfortunately, the three big credit reporting agencies (Experian, TransUnion and Equifax) only allow you to request a complimentary credit report once a year. Sites like Credit Karma give you the opportunity to monitor your credit and check on your score throughout the year. With multiple data breaches in the news, you might be wondering, “Is Credit Karma safe?” Learn how the site works, and why it’s important to stay on top of your credit score.

How Sites Like Credit Karma Work

Credit Karma collects your name, email address, physical address, birth date and Social Security number. It uses this information to generate a soft credit inquiry. You can then see your credit score and a detailed credit report from two of the three credit reporting agencies — TransUnion and Equifax. This doesn’t affect your credit like a hard credit inquirywhich occurs when you apply for a loan or credit card.

Credit Karma, as well as many other credit reporting sites, uses VantageScore to provide credit scores. While the FICO score, which was created by the Fair Isaac Corporation, is the more well-known score, the VantageScore was developed by the three major credit reporting agencies themselves.

Is Credit Karma accurate with its results? The VantageScore credit score estimator uses the same criteria as the FICO estimator, including things like payment history, types of credit, how long you’ve had credit and how often you use credit.

Get More Details: How Your FICO Score and VantageScore  Are Similar and Different

Is Credit Karma Secure?

To prevent a Credit Karma data breach and to protect your information, the company has a number of security measures in place.

  • The site uses 128-bit or higher encryption to protect customers.
  • Users have the option to turn on SMS two-factor authentication.
  • Users receive alerts whenever any suspicious activity occurs on an account.
  • The company doesn’t share or sell personal information to unaffiliated third parties.
  • Outside agencies perform security assessments and audits of Credit Karma.

How Does Credit Karma Make Money?

You don’t have to worry about a Credit Karma scam, as the company has a business model that works for both its customers and partners.

Customers who use Credit Karma fill out their information and request their free credit score and associated report. They are then able to review the report to check for errors. They will also see whether their credit score is in the fair, good or excellent range, which is important when determining if it is a good time to apply for a mortgage, car loan or credit card.

Businesses who partner with Credit Karma benefit when Credit Karma matches the customer’s data with their products and services. Customers are provided with these recommendations and are not under any obligation to sign up for the offers in order to keep using Credit Karma. If they decide the offer fits their needs and they take advantage of it, the business gets a sale and Credit Karma is rewarded for the referral.

Is Credit Karma Reliable?

With millions of customers, Credit Karma has proven to be a reliable and trustworthy company. Credit Karma isn’t the only option if you’re looking to check your credit, however.

Visit AnnualCreditReport.com to see your credit reports from the three reporting agencies once a year. The downside of this service is you won’t receive your credit score, just what is on your report.

At GOFreeCredit.com, during your week-long trial for just $1 you’ll be able to see your credit score and credit report from TransUnion. If you continue to subscribe to the credit-monitoring service after the trial ends, you’ll be able to review your Experian and Equifax credit reports as well.

The Final Word

Credit check sites work hard to keep your personal data safe. Checking your credit score and report regularly is an important part of being a responsible financial citizen.

Up Next: How to Read a Credit Report

GOBankingRates.com and GOFreeCredit.com are both owned by ConsumerTrack, Inc., an online marketing company serving top-tier banks, credit unions and other financial services organizations.