Obtaining your credit score and credit report in Canada used to be costly, but thanks to online financial services companies like Credit Karma, Canadians can now access these essential financial tools for free. In this review, we’ll explore Credit Karma’s offerings, how to use their services, and how they compare to Borrowell.
Credit Karma, founded in 2006 in the United States, expanded its operations to Canada in 2016. It’s available to residents of Alberta, Ontario, Manitoba, British Columbia, New Brunswick, PEI, Saskatchewan, Nova Scotia, and Newfoundland and Labrador. Credit Karma provides free credit scores, reports, and credit monitoring, and in the U.S., they offer free tax filing services. You might wonder how Credit Karma makes money. They generate revenue by providing credit card recommendations based on your credit profile, earning referral fees from banks if you apply for these cards, all without any additional cost to you.
Signing up for Credit Karma’s free credit score and monitoring service is straightforward:
Credit Karma is indeed safe and legitimate. Users are not required to provide credit card information or Social Insurance Numbers. The occasional email with credit card offers is non-obligatory, and accessing your credit score and report remains genuinely free. Credit Karma takes security seriously, employing 128-bit or higher encryption to protect data transmission and not sharing personal information with unaffiliated third parties. They also use firewalls and other technologies to secure your account, but, as with any online service, there are inherent risks.
Credit Karma provides credit scores and reports from TransUnion, one of Canada’s main credit bureaus. However, it’s important to note that Equifax and TransUnion use different algorithms, which may result in score variations. Additionally, the TransUnion score you see on Credit Karma may differ from the one lenders use.
Credit Karma and Borrowell are both excellent options for free credit score monitoring, with a few differences:
In Canada, credit scores range from 300 to 900, and a “good” credit score is typically any score over 650. Higher scores increase your chances of obtaining competitive interest rates when borrowing money. Credit bureaus consider factors like loan repayment history, total debt, credit history length, new inquiries, and credit mix when calculating your score.
In addition to your credit score, lenders review your credit report, which contains details of your debt usage over time. This includes personal information, a list of credit accounts, public records, inquiries, and consumer statements. Canadian credit bureaus must provide one free credit report copy annually upon request. Services like Credit Karma and Borrowell offer free monthly or weekly credit report updates.
Here are some common questions about Credit Karma:
No, using Credit Karma for checking your own score results in “soft inquiries” that do not impact your credit score.
No, credit card information is not required, and there are no fees for accessing your free credit score.
Providing your SIN is optional, and you can access your free credit score without disclosing it.
Credit Karma does not offer phone support, but you can submit questions through their website support page, and they will respond via email.
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