Anyone tried Creditkarma.com?

[jpg7n16]

I just signed up at the site, out of curiosity. CreditKarma scored me at 747, which is 51 points lower than the 798 I got from myFICO two days ago.

My feelings are hurt now. *lol* Especially since they gave me an "F" for my number of credit accounts on their little "report card" feature. Not having a bunch of CCs and loans is a GOOD thing as far as I'm concerned, but I'm aware it's considered a negative as far as scores go. I'll take the "F" in that class any day.

That said - I like the site. It's nice that you can get some sort of estimate and see where you stand without having to pay for it. Thanks for posting.

That is not a problem with the site, it is a problem with the entire credit score system.

A credit score will never show you how smart you are being about limiting your debt. It will only show how likely you are to pay a lot of interest and pay your stuff on time. More cards available means more money you could potentially borrow - making you pay more in interest to the banks.

I actually just read that Warren Buffett's credit score is like 708 or something. (Apparently that's been out a while now) So, many people have a higher credit score than him. Now who is more likely to have the ability to repay? Me or Buffett? Obv Buffett. But who is more likely to pay banks a lot of interest? Me. Buffett doesn't need to borrow, but I might. So my score is higher than his.

The site is good for what it aims to do - show you how to raise your credit score.

The site shouldn't be used to see how to be financially healthy - a credit score will never tell you that.

[disneysteve]

It will only show how likely you are to pay a lot of interest

That isn't quite true. Our combined credit card limits are about $100,000. Our annual charges average about $40,000. We never pay a penny in interest because we pay our balances in full every single month and we never charge more than 5% of our limit and usually closer to 3%. Our FICO scores are in the 800 range (haven't checked lately - don't need to know). I know Dave Ramsey calls a FICO score an "I love debt" score but you don't have to be in debt to have a good score and using credit cards does not automatically mean you are in debt.

The site shouldn't be used to see how to be financially healthy - a credit score will never tell you that.

This is totally true. Your FICO score says nothing at all about your financial situation. You could have a great score, lots of debt and no savings or you could have a lousy score, no debt and lots of savings. I'd pick the latter situation any day.

[strigiformes]

That is not a problem with the site, it is a problem with the entire credit score system.

Yes, I know. I just don't like being told I got a big fat F. Don't much care for the system, either. As you and DS said, it doesn't truly reflect a person's financial health.

It makes me wonder how it has become so important. The credit scoring system could be seen as another contributor to this current financial mess, in that it may give lenders and borrowers (and all the other entities that have started relying on it - like employers and rental property managers) a false sense of security.

[strigiformes]

That isn't quite true. Our combined credit card limits are about $100,000. Our annual charges average about $40,000. We never pay a penny in interest because we pay our balances in full every single month and we never charge more than 5% of our limit and usually closer to 3%. Our FICO scores are in the 800 range (haven't checked lately - don't need to know). I know Dave Ramsey calls a FICO score an "I love debt" score but you don't have to be in debt to have a good score and using credit cards does not automatically mean you are in debt.

Quite right. I have never paid interest on a credit card, hopefully never will. I charge around $2,000 monthly on a single $15,000 limit card, and pay it in full every month. My car is paid for, and our mortgage is in my husband's name only - apparently, having too few open lines of credit hurts my score, yet my score is still pretty good since I have always paid my obligations as agreed and I don't use too high a percentage of the credit I DO have.

It seems contradictory, but there it is. I'm satisfied with things the way they are, in any case.

[jpg7n16]

That isn't quite true. Our combined credit card limits are about $100,000. Our annual charges average about $40,000. We never pay a penny in interest because we pay our balances in full every single month and we never charge more than 5% of our limit and usually closer to 3%. Our FICO scores are in the 800 range (haven't checked lately - don't need to know). I know Dave Ramsey calls a FICO score an "I love debt" score but you don't have to be in debt to have a good score and using credit cards does not automatically mean you are in debt.

I personally believe it is absolutely what the scores are for, and that you and Strig (and several others) are all tricking the system. Cause when you use the card all month, when the credit bureau pulls your account info, it shows a balance. People with balances in general get charged interest, so you're a more likely person to get charged interest. (And if like the majority of people you didn't pay it off, you would get charged interest like the majority of the general public - so it is a good easy measure) You'll note that even though by the end of the month, it will be at 0, the credit report will show a balance outstanding on the card for use of "credit utilization."

But then you do the smart thing and pay them off before the close of the month to avoid actually getting charged interest. So you trick the system. It is my understanding that if your balances are reported to the bureau at 0, you don't get as high of a score. (If they are too high, you run the risk of not paying back what you owe, and negates the income potential - thus a lower score for too high of a balance)

It cannot be a true measure of creditworthiness, otherwise Warren Buffett would be at the max. He has the most resources to repay, and has assets you could lay claim to in court to satisfy any debt. But your score is higher than his?

What exactly does a "credit score" show then??

Creditworthiness? Nope. Ability to repay? Nope. Likelihood of repayment? Nope. Financial health? Not even close. In my personal view, no matter what they say, it's designed to show who is the most likely customer to generate income for the bank/credit issuer - while not costing money due to non-payment.

[strigiformes]

Hmmm...that sounds logical to me, jpg. My car loan from years ago is the only major loan I've ever had and I've never wanted another, so I never actually bothered to check my credit until recently. It surprised me to see the $2,000 I spend monthly listed as a 'balance'.

My husband's credit score is higher than mine. He has what the average person would consider a significant amount of (secured!) debt, but also a very long history of paying his obligations on time and as agreed. I shudder to think of all the money he has made for the banks over the years via all that interest. So I suspect you're right about the true purpose of the score - it makes sense.

[Stuartthomas]

i just got it here in this thread..but i have some doubt over its credibility so i will keep a check over it ..and will tell once i got something about it...

[Macdonnell1]

Love CreditKarma

I just finished accessing my credit score for free on Creditkarma, and was really impressed with the site. You can access your score for free, and it is truly free unlike some of the other scam sites (you don't even provide a credit card to sign up). They also have some comparison data so you can see where you stand. The best thing I saw was a score simulator, which allows you to simulate the effect on your score by changing various parameters (take on more/less credit card debt, open a new credit card, open a new loan, go into bankruptcy, etc).

Has anyone else tried this site? I would be interested to see if anyone has compared the score given to the real FICO score.

I have tried the site twice over the last year and it is spot on . Very accurate. Clark Howard ran a story on the service an rated it #1 among credit scoring companies. ALSO this site provides you with credit monitoring for free. What is the catch, you may ask? They are gaining traction with advertising opportunities through social media.