Comments on: Is Credit Karma Useful in Monitoring Credit Score?

By: louis fernandez

louis fernandez — Sun, 06 Jun 2010 15:13:48 +0000

i just registered with creditkarma. didn’t want to pay 8 bucks for a score that can change daily. i know that my fico score is higher than what my creditkarma score is, but at least i have a starting point. a

hard inquiry will only show up as one even though there were multiple ones if related to same search within 30 days.

all in all, a good source to keep you on your toes.

By: InTheIndustry

InTheIndustry — Fri, 02 Oct 2009 17:05:51 +0000

One more thing I forgot to mention – my own Credit Karma score has fluctuated over a 70-point range since I signed up a year or so ago, but I’ve done a lot since then. Bought a house, paid off an auto loan, picked up some new credit cards, paid off some student loans. I have seen my score move on most inquiries, but it moves most dramatically when my debt profile changes. I bought a lot of furniture on credit cards recently, for the cash back, intending to pay off right away or at the end of the 0% term, and that stuff dropped my score quite a bit. Undoubtedly because my utilization went from something like 10% to 45%.

By: InTheIndustry

InTheIndustry — Fri, 02 Oct 2009 16:58:26 +0000

Even when they are using the same formula brand, like FICO, they won’t have the same scores because of the different data. My personal FICO scores across each bureau vary by as much as 60 points, and just because one moves doesn’t mean the others will move.

Don’t forget that FICO, too, has multiple models – there’s FICO for home loans, auto loans, credit cards, etc. So you might get an Experian FICO targeted for mortgages over here, and a TransUnion FICO for new revolving accounts over there, and those numbers aren’t going to be the same at all, nor will they necessarily move in the same way. Different data and different models. Consumer-level score services don’t go into this kind of detail usually when they tell you what you’re getting – people just see “FICO” and think it’s all the same, but it’s really not. It depends on who’s providing it, and on what they’re using it for.

The only saving grace for the consumer is that they are all highly correlative. So, you’re not going to be 780 in one place and 520 in another. More like 700 and 780. Sometimes you’ll get stuck in the 670-750 range, and that sucks, because who knows what lenders are seeing. All you can really do is keep an eye on one or two scores and make sure nothing blows up. Lenders make decisions on more than just credit scores anyhow. Scores get your foot in the door, but income and especially DTI really mean a lot.

By: Sun

Sun — Fri, 02 Oct 2009 15:44:24 +0000

@InTheIndustry Thanks for the information. I know what you are saying. Each credit agency uses their own formula developed in house to calculate their own score, with different weighting on each category, when they are not using FICO. However, I expect every formula cover roughly the same categories, such as credit history, payment history etc. Thus, it’s hard for me to understand that when FICO dropped more than 10 points, CK showed no change at all. Of course, different financial institution may not report the same information to all three agencies, which, as you said, may cause discrepancy in scores among agencies.

By: InTheIndustry

InTheIndustry — Thu, 01 Oct 2009 03:39:06 +0000

A hard inquiry will usually only move your score a couple of points, and in some cases, it won’t move at all (or go up if now you’re reporting higher limits). It depends on what the bureau has on file for you. Keep in mind, too, that different credit bureaus have different data. Just because a hard inquiry was sent to Equifax, doesn’t mean it was sent to TransUnion. Likewise, your credit history will be recorded differently on each bureau. That’s not to say that Credit Karma isn’t having some issue on your particular account – if you know that from some other source, like TrueCredit, that TransUnion is recording inquiries and Credit Karma isn’t, then you should let them know about that – but comparing Experian, Equifax, and TransUnion to each other is not going to give you the result you’re looking for.