There are so many people who would like to know whether it is possible to monitor credit report and score on Credit Karma or not as it hurts the credit. Well, the short answer is no – only reporting to Credit Karma and using it to check your credit information will not impact your credit score with the major credit bureaus. Here is a more detailed explanation as to why the act of checking your credit on Credit Karma will not harm your credit rating.
How Credit Karma Works
To know why Credit Karma won’t lower your scores, it is pertinent to know what Credit Karma is and how it operates. Credit Karma is a personal finance company which offers free credit reports from TransUnion and Equifax as well as VantageScore credit scores.
When you register for Credit Karma, you input some of your details such as your name, address, Social Security number, date of birth so that Credit Karma can retrieve your credit information. The application then utilizes this information to safely authenticate with TransUnion and Equifax and request your credit reports.
Issuers then utilize the details provided in credit reports to arrive at your VantageScore credit scores. VantageScore is a credit scoring model that is similar to FICO, but not identical to it.
Credit Checks and Credit Inquiries
When talking about whether checking Credit Karma can decrease your scores, one should know about credit checks/inquiries. There are two main types of credit checks:There are two main types of credit checks:
Soft Credit Checks Otherwise known as soft credit inquiries, soft credit checks do not in any way, shape, or form affect your credit ratings. These types of credit checks only go through the data you have on record without making any notation on your records.
Hard Credit Inquiries These are also referred to as hard credit checks or hard credit inquiries and these do appear on your credit reports and for a while your credit scores will be reduced. Hard inquiries can be those done when you apply for credit like credit cards or loans, among others. many hard inquiries can hurt your credit standing.
Why Credit Karma Is A Soft Check
The main reason using Credit Karma does not affect your credit score is they do not pull credit reports as a hard credit check. If you use Credit Karma to get your credit information, they do not pull your credit reports, and do not report hard inquiries on your TransUnion or Equifax credit reports.
Credit Karma offers soft credit checks, and this means no credit inquiries are made, and there are no effects on any of the scores. This means that you may periodically check your credit reports and VantageScores for any discrepancies on Credit Karma without negatively affecting your scores.
It's Your Information
Yet another reason is that when you use Credit Karma to check your scores, you are not applying for any credit, so your scores do not drop. Credit Karma does not ask for any new credit or open any new credit in your name.
It is your right to request and receive copies of your credit scores from TransUnion and Equifax as often as you want, and Credit Karma is just a convenient and costless way to do so. Well, you are not really applying for or getting approved for anything fresh in this case. You are simply observing your own assessments.
Credit Karma clearly mentions that the service does not reduce the credit score of the customers. As they explain on their website: “When you sign up for Credit Karma, you only undergo a soft credit check, which means that using your credit information and scores to check your own credit will not impact your scores. ”
Why Your Scores May Fluctuate Anyway
So, using Credit Karma directly will not decrease your credit score, though fluctuation in the score is quite natural from time to time. This is because the credit information and the data contained in your credit reports are dynamic in nature. Factors like:
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Higher utilization of credit cards
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New accounts opened
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Variations in the length of credit history
- Hard credit inquiries
Even all cause small fluctuations in your scores. That is why, when you go toCredit Karma to check your scores, you may see that they fluctuate by a couple of points. However, if you do not find any new hard inquiries or negative items appearing on your credit reports, then there is nothing to worry about.
The only exception here is when your checking of your credit reports very often leads to you developing an unhealthy fixation or anxiety over every single change or figure that may be there. This is because constantly worrying or stressing yourself about credit might affect your future financial behavior. In that rather remote scenario, it may be helpful to restrict your usage of Credit Karma.
Is It Possible to Improve Your Credit Score by Checking Credit Karma?
Since Credit Karma will not reduce your credit scores in any way, can the frequent use of the service increase your scores? However, to check Credit Karma, on its own, will not help in enhancing your credit profile or rating by TransUnion and Equifax or FICO.
The only way Credit Karma can benefit your credit positioning is in helping you address problems before they escalate. This way, you may identify problems at an earlier stage because you are looking at your latest credit information and VantageScores. It could give you the chance to correct credit report mistakes or unpaid bills that have been left unpaid before they cause the scores to dip.
Apart from helping you identify potential issues early on, Credit Karma itself won’t improve your credit score on its own. The most effective ways to genuinely improve your credit over time involve responsible behaviors like:The most effective ways to genuinely improve your credit over time involve responsible behaviors like:
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Try to ensure that bills are paid as soon as they are due
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Paying as much as possible for credit card dues on time
- Reducing hard credit check where not necessary
Thus, although Credit Karma can help with credit awareness and education, it is the further responsible credit behavior that helps improve your scores.
The Takeaway
To be clear, when you review your credit information and your VantageScores on Credit Karma, they’ll never negatively impact your credit. They make it clear that what they perform is soft credit checks which are not reported or included as hard inquiries.
Since you are not applying for a new credit; instead, they are reporting back your own pre-existing credit information, using their service to check your credit score will not harm your credit score. However, do note that even with these factors in play, other credit activities could still cause more frequent, but smaller changes to your score.
In general, Credit Karma allows you to check your latest credit information as frequently as you wish with no negative effects. Therefore, being an informed credit consumer by monitoring your credit reports and scores through their service will not lead to any credit score deductions.
