Pulls credit reports and scores from TransUnion and Equifax. Great educational material. Free.
Missing some helpful tools found in the web app. Weak on mobile alerts.
- Bottom Line
Credit Karma's iPhone app lets you see your credit report and score whenever you want, updated as often as weekly. It doesn't do everything the web service does, however, nor does it have any special mobile features.
By Jill Duffy
Credit Karma is a free mobile finance app that provides your credit report and score from two of the three credit reporting agencies. It also contains educational material about personal finance, such as what makes a credit score go up or down. You can use Credit Karma on the web or as a mobile app, although there isn't much in the iPhone version that caters specifically to the mobile experience. The web version has everything that's in the iPhone app and then some. I'd only use Credit Karma for iPhone if I were a mobile-first person, meaning my phone was my primary computing device. If that's your situation, it's a good app to have.
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This review looks specifically at Credit Karma's iPhone app. For additional details about the service, see my thorough review of Credit Karma. Additionally, there is a Credit Karma Android app, which has slightly different features than the iPhone app, so see that review if you're an Android user.
Price and Information Required
The Credit Karma app is free to download and use. At no point during the signup process does it even ask you to enter any credit card details. For the service to work, however, you need to provide some personal information, such as date of birth and the last four digits of your social security number. You also have to verify your identity by answering questions such as "Which of these phone numbers have you never had?" In signing up, you must agree to let Credit Karma pull your credit report from TransUnion and Equifax.
How does Credit Karma make money? Credit Karma takes the data you provide, as well as the information it gets from your credit report, and uses them to show you highly targeted advertising. For example, Credit Karma knows if you have a credit card with a balance. It knows the interest rate you pay on that balance, whether you've been charged late fees, and so forth. The app can therefore show you an ad for credit cards that offer a really good deal for people who transfer balances.
Credit Karma isn't the only app to pull your credit report and score. WalletHub is similar, and it updates your score daily. Mint provides a credit score and report, too, updated monthly. There are others as well, including Credit Sesame and NerdWallet. Credit Karma is unique in that it pulls your VantageScore and credit reports from two agencies rather than just one, although how much value there is in getting your score from two sources that use the same formula instead of one is questionable.
Security and Privacy
At the app level, Credit Karma requires a four-digit PIN. The Android app has a default setting that prevents screenshots of the app, which you can bypass in the settings. The iPhone version let me freely snap pictures of my financial reports.
The only part of Credit Karma's policies that caught my eye is related to "canceling and deactivating" your membership. You can cancel and deactivate your membership, but doing so does not wipe your data from Credit Karma's system. Upon deactivation, the company disables your account and stops sending communications, but it keeps your data for two years, and some time after that anonymizes it.
What's in the Credit Karma iPhone App?
The Credit Karma iPhone app doesn't have as much to offer as the website. The app focuses almost exclusively on credit reports and scores, whereas the site has a few additional features. The app does provide good level of detail with your credit reports and scores, though. For example, the home screen of the app displays a credit score, and beneath it you see the name of the source (such as TransUnion or Equifax), date when it was last updated, whether it's gone up or down since the score was last updated, and a summary of what the score means (excellent, good, and so on).
From the home screen, you can scroll down to see offers or swipe for other options. When you swipe, customized screens appear that change all the time. Recently, mine contained an offer for a personal loan, information about how the balance on one of my credit cards increased, and a final page that let me link to even more information (View Accounts, Get Score Details, Get My Recommendations, and See Offers).
Credit Karma tells you a lot about factors that affect your credit report and score. In that sense, it's highly educational. It provides personalized information about you and your credit history, as well as an overall assessment of what the different factors mean. It explains what a hard inquiry is, for example, while also showing you if you have any on your credit report.
One of the primary reasons to check your credit report is to make sure nothing fishy is on it that shouldn't be. You can do that with the Credit Karma app because you can see your entire credit report. Better are the alerts Credit Karma sends you when it notices a change on your credit report. Unfortunately, those alerts come via email, not phone notifications, which seems like a missed opportunity. Mint, however, uses push notifications to alert you of changes to your account, including an updated credit score, but also anything you sign up to receive, such as when a charge greater than a certain amount hits your credit card. Credit Karma does offer other kinds of alerts, but, again, only by email, and you have to manage those alerts via the Web app, as they aren't accessible via the iPhone app.
The offers are solid, and in some ways, I like them more than Mint.com's offers, because Credit Karma's give more explicit details. A credit card offer showed three key points highlighted in their own boxes: annual fee, introductory purchase APR, and regular purchase APR. Below that were additional details about the perks of the card. If you click through to read more about the offer, you'll see Credit Karma's Take with a few points on "What to Like" and "Look Out For." That information can help you spot a card that's not a good fit.
In one instance, Credit Karma flagged that a credit card would charge me international purchase fees. As much as the app knows about my financial data, it doesn't know that the majority of my credit card spending happens overseas. I'm glad I didn't apply for that card! Conversely, the last time I applied for a new credit card through Mint, there were no pros or cons mentioned, and I forgot to read closely for information about foreign transactions. Now I'm stuck with a card that I never use.
You also see your "approval odds" next to some of the ads, meaning Credit Karma tells you whether it thinks your application for the offer would be successful.
Not all the offers are 100 percent spot on, though. One pop-up told me: "Your credit card balance may be costing you as much as $767 in interest." Alarming! The app wanted to show me an offer for a credit card with a lower interest rate. However, it failed to notice that I pay off all my credit cards in full every month, and I always have. Because I never carry a balance, I pay $0 in interest. So while the offers appear smart and customized, you still need to know enough about your own financial situation to competently judge the offers.
One other bit of functionality that's buried and hard to find in the iPhone app is a search tool that helps you look for unclaimed money owed to you (or anyone else's name you search) in various states. Type a full name, and wait for results. If there's a match, Credit Karma tells you some details, such as the amount, source of the money, and the city and state on file for the person who's owed the money. To make a claim, Credit Karma sends you off to the appropriate website for that state. This function works fine on the mobile app, but once Credit Karma pushes you to an outside page where you can try to claim the money, you may find it's not mobile optimized.
Missing from Credit Karma's mobile app are any features that are unique to the mobile experience. The Credit Karma website has a neat credit prediction tool that shows how your credit score might be affected if certain events occur. For example, what will happen if I apply for a loan and get denied, or open a new line of credit? The Credit Karma web app tells you what would happen and anticipates how much it would hurt or help your credit score. That would be a nice tool to have on a mobile device, for the next time you're stuck in an airport for three hours with a guy trying to push a credit card application on you, for example.
The web app also has some rudimentary tools for tracking your spending, and these aren't in the Android app, but they do appear in the iPhone app…sort of. The tools look like they are being pulled straight from the website and scaled down to iPhone size, rather than being ported and reformatted to be legible on the smaller screen. It's not much of a loss, because the tools aren't very good yet, anyhow. They have potential, but they're in the early stages of development.
These spend-tracking tools are a rough facsimile of Mint's tracking tools, which are much more developed and are superbly tailored for use on the service's mobile apps. They give you immediate insight into the balance of all your accounts, so you know before you make a purchase whether you're going to overdraw a debit account or max out a credit card. Mint also alerts you if you're nearing your monthly budget in any given spending category, helping you think twice before you blow $4 on another latte.
Mint also has bill payment features that alert you before your bills are past due. You can make a payment directly from the Mint mobile app, and, in many cases, the transaction goes through within 24 hours. Because the app helps you pay bills immediately when you are reminded that they're due, it effectively helps you avoid late fees and other financial problems. Credit Karma doesn't have anything like that. It sends an email reminder when a bill is nearing due, but that's not nearly the same thing.
Useful, but Not Daily
Credit Karma's iPhone app won't rip you off, and it does provide value, but really only in limited circumstances. If you need to know your credit report and score, it can tell you. But it doesn't have all the tools or alerts that take a personal finance mobile app from good to indispensable. Mint does, and for that reason, it's a PCMag Editors' Choice. Credit Karma is a fine tool for what it does. There's no reason you can't use both it and Mint. But you'll get more daily use from Mint.
Jill Duffy is a contributing editor, specializing in productivity apps and software, as well as technologies for health and fitness. She writes the weekly Get Organized column, with tips on how to lead a better digital life. Her first book, Get Organized: How to Clean Up Your Messy Digital Life is available for Kindle, iPad, and other digital formats. She is also the creator and author of ProductivityReport.org. Before joining PCMag.com, she was senior editor at the Association for Computing Machinery, a non-profit membership organization for… More »
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