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Holiday-Ready Finances: 8-Part Checklist for Your Budget and Your Credit

October 10th, 2017 · Budgeting

Holiday-Ready Finances: 8-Part Checklist for Your Budget and Your CreditWhether you think you have all your bases covered, or you know you’re in over your head, this 8-part checklist can help you get holiday-ready finances. Equally instructional and motivational, this checklist will walk you through the process of creating a holiday budget and a strategy for sticking to it, including affordable gift ideas, holiday sale best practices, how to use (and not use) your credit cards, and what to do when you realize you’ve spent too much. We also cover ways you can hurt your credit during the holidays and the credit-healthy choices you can make instead that are good for credit building and credit repair.

1) Do you have a holiday budget?

Even the best budgeters among us forget to include every category of spending. Holiday expenses is a perfect example.

Ideally, the budget you use year-round includes a set amount of monthly savings that you designate to a holiday spending category. Simply add up what you normally spend during the holidays, divide by twelve, and set aside that much every month. But don’t stop there.

The money you save all year long for holiday expenses should have a budget of its own. Learn how to create a holiday budget that breaks holiday spending down into subcategories: gifts, food, travel, and charitable giving.

2) Are you saving for holiday expenses?

It’s not too late. There is plenty you can do to come up with some money that doesn’t involve charging up your credit cards. As of this writing, you have 11 weeks until Christmas. That’s plenty of time to stockpile a little something that could contribute a lot to your holiday budget.

Think about it. Are there any extras you could eliminate for the next three months? Extras that are nice to have but that you don’t really need? Could you cancel one or more of your streaming services? Make your own lunch? Skip the latte? Hang out with family and friends at home instead of going out?

If these and other ways of cutting back help you set aside just $25 a week from now until Christmas, that’s $275 you can use to budget for the holidays this year.

3) Could you cut your holiday budget in half?

Even if you save a little extra each week between now and Christmas, it may not be enough to cover everything you want to do for the holidays this year. If it feels like your only option is charging the shortfall to your credit cards, then you haven’t seriously considered the smarter alternative — cutting your budget in half.

Only you know the categories of holiday spending that are more flexible than others for you, but one flexibility we all share is in how much we choose to spend on gifts.

  • Not convinced a $25 gift can be just as special as a $50 gift?
  • Can’t imagine changing your gift idea?
  • Worried you won’t be able to find gifts that are both cheap and thoughtful?
  • Afraid they’ll know you spent last?
  • Think it’s a good idea but something you should wait and try next year?

Legitimate concerns, all of them, and we have answers that address every one.

Related posts

Thanksgiving Dinner on a Budget: Couponing

7 Ways To Cut the Cost of Christmas Dinner

4) Do you have affordable gift ideas?

It’s one thing to embrace the idea of buying less expensive gifts. It’s quite another figuring out what those gifts should be. Get as creative as you like, but if you get stuck, or just need a place to start, we have some ideas.

Check out our 50 cheap (and thoughtful) Christmas gift ideas that can work for holiday budgets with spending amounts ranging from $5 to $50 per person.

Too late to spend much time putting creative gifts together? Check out our 5 easy fixes for last-minute gifts you can find at the grocery store.

Related posts

18 Ways To Wrap Gifts With What You Already Have at Home

10 Tips for Gifting and Receiving Gift Cards for Christmas

Fun Gifts that Teach Your Kids Money Management

Layaway Q & A: Does It Make Good Shopping Sense?

5) Are you avoiding credit cards?

If you’re in the habit of charging holiday expenses to your credit cards, you’re not alone. It’s a habit that many of us practice as though it is its own holiday tradition. But while there is nothing wrong with credit card charges that you pay off within 30 days, carrying a balance for months into the New Year is an expensive habit that’s simply not worth the payoff.

As exciting as it is to see the faces of family and friends as they open your gifts, what they will appreciate more is you staying within your budget so that you don’t spend every month thereafter paying interest on their gifts instead of putting that money toward your financial goals.

Before charging a gift to your credit card, ask yourself this:

1) Is the item on your list?
2) Is it at or under the amount you planned to spend on this person?
3) Can you pay off the charge by the due date?

If the answer isn’t yes to all of these questions, don’t charge it. If this leaves you scrambling to afford everything on your list:

  • Lower the amounts you were planning to spend on everyone
  • If you’ve already bought gifts, return them and buy less expensive ones
  • Suggest a gift exchange in which family or friends draw names so that each person only gives (and receives) one gift within the group
  • If your family or friends have a set spending cap, talk to them about lowering the limit; chances are they will not only be receptive to it but grateful that you were the one who brought it up so that they didn’t have to

Related posts

Pre-Holiday Pep Talk for Debt-Free Giving

After-Christmas Credit Card Reset

6) Do you know how to make holiday sales work for you?

You have to be careful on Black Friday and Cyber Monday. On the one hand, they can be great days to get good deals. On the other hand, they can be dangerous days when you get too caught up in the shopping frenzy and make costly mistakes.

You’re not making holiday sales work for you if you are:

  • Going over your budget
  • Buying things that are not on your list
  • Buying things that are not on sale, an especially tempting thing to do if you’re not finding the sale items you’d hoped for buy you’re in the buying mood
  • Not comparison shopping (before you leave the house or click the buy button, make sure you know what other retailers are charging for it)
  • Not asking about price matching (many stores price match, but exclusions apply)
  • Not asking about the return policy, a nice safety net to have in case you do go over budget and need to get your money back
  • Not keeping your receipts (even stores that don’t require them for return items often only give you store credit)
  • Not making sure online stores are secure (look for https:// and the lock icon)
    Hitting the sales by yourself when you know you do better shopping with a family member or friend who can help keep you in check

Related posts

Black Friday: 10 Ways To Get the Best Deals (and Have the Most Fun)

6 Super Cyber Monday Shopping Tips

9 Smartest Buys at Day After Christmas Sales

7) Have you already spent too much?

The answer is yes if any of the following circumstances are true for you:

  • You’ve gone over your budget
  • You’re charging more to your credit cards then you can afford to pay off within 30 days
  • You’re compromising important financial goals in the New Year

If any of these ring true for you:

  • Don’t spend another cent
  • Return items you’ve already bought and replace them with less expensive gifts
  • If you still have people to buy for, stretch the money you get from returned items to include them, too

Related posts

The “Don’t Buy It If…” Holiday Shopping Rules

3 Lies to Ignore This Holiday Shopping Season

Holiday Spending: The Right and Wrong Order of Things

10 Signs You’re Headed For a Holiday Shopping Hangover

8) Are you keeping your credit in mind?

The holidays have a way of suspending reality for a while. It happens with money, of course, talking yourself into spending more than you know you can afford through all sorts of rationalizations: Christmas is only once a year. The people you’re buying for are worth it. You already have so much debt; what’s a few hundred more dollars?

The holidays can have a similar effect on how you treat your credit:

  • If your credit is great, maybe you think you can afford to be a little reckless. Or maybe you underestimate the impact of certain behaviors on your credit score.
  • If you’re repairing your credit, and really deep into the process, maybe you feel like a break is deserved. Or, if you’re just getting started, maybe you rationalize that this can be one last hurrah before you really get serious about cleaning up your credit score.
  • If your credit is bad and you’ve not done a single thing to make it better, maybe you think the damage is already done. How much worse can it get?

Yet, it is because of these tempting rationalizations that you have to be more disciplined with your credit behavior during the holidays than any other time of year.

Ways you can hurt your credit during the holidays

  • Charging more to your credit cards then you can pay back with cash by the due date
  • Using more than 30% of your available credit at any one time
  • Maxing out your credit cards, sending your credit utilization ratio through the roof
  • Paying late and having the account sent to collections
  • Falling so behind on payments that the credit card issuer charges it off
  • Not following smart shopping practices that help protect against ID theft and fraud

Ways you can help your credit during the holidays

  • Using cash instead of credit
  • If you do use credit, only charging as much as you can afford to pay back within 30 days
  • Never using more than 10-30% of available credit at any one time, the ideal
  • credit utilization ratioReturning your credit card balance to zero every month, not only helping your credit score, but eliminating the possibility of interest fees
  • Paying all of your bills on time
  • Signing up for credit monitoring to track credit progress, and to detect errors and fraud
  • Freezing your credit to help protect against fraud, recommended by experts and regulators in the wake of the Equifax hack

Related posts

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What to Expect from an Employment Credit Check

October 3rd, 2017 · Credit Reports

What to Expect from an Employment Credit CheckDo you know how a potential employer can check your credit? Do you know what type of credit information — and other background records — they are going to see? Do you know how to request a copy of this information? What about disputing inaccuracies (an essential step in the credit repair process)? Get the facts about what to expect from an employment credit check.

How employers get permission to check your credit

Not just anyone can check your credit. From lenders to employers, they must have what is called permissible purpose. Permission is automatically granted when you apply for credit, but employers must get your express written consent first.

Not all, or even most, employers check credit, but some do, if only for select positions that require the handling of money or confidential information. You’ll find out whether a credit check is required at some point in the hiring process, at which time they will request your written authorization – of a credit check or more comprehensive background check that may include your credit history.

What this means, of course, is that you can refuse to allow an employer access to your credit. Just be prepared to lose out on the job opportunity.

What they see in an employment credit check

In general, what employers see when they check your credit is very similar to what creditors see:

  • Personally-identifying information (name, social security number, addresses, employers, other names you have gone by)
  • Public records (liens, judgments, bankruptcies)
  • Credit history (credit accounts, payment history, collections, charge offs)

However, what employers will not see in a credit check is your 1) date of birth or 2) credit score.

How an employment credit check affects your reports and scores

It doesn’t. Unlike hard credit inquiries conducted by creditors, which knock a few points off your credit score, your score is not affected by employer credit checks. And unlike creditor credit checks that appear as hard inquiries on your reports, employer credit checks don’t show up on your credit reports at all.

How to request copies of the consumer reports seen by employers

Any company that compiles consumer reports on you is required by law to disclose this information to you – for free – every 12 months. This won’t happen automatically, though. You must request it. (You are also entitled to a free report if its contents resulted in you being denied a job. See other special circumstances in our Credit Reports Guide: 11 Things Simply Explained.)

You’re likely already pretty familiar with three of these companies that may be providing information to employers – Experian, TransUnion, and Equifax. But there are several other consumer reporting agencies that provide employment screening services exclusively.

In any case, each company must be contacted individually to request a copy of your report.

Note, employment screening companies may or may not have any information to disclose to you. As many state on their websites, they will only have reports on you if one of their employer clients has requested they compile one.

How to dispute information included in consumer reports seen by employers

As helpful as it might be simply knowing what’s in the consumer reports seen by employers, what’s even more invaluable is the ability to dispute what’s there. Go through these reports carefully and dispute anything that may be inaccurate or unverifiable. Once you file the dispute, the company is required by law to investigate. If the listing cannot be proven as accurate, it must be corrected or removed.

Tips for filing a dispute

  • Though these companies provide multiple ways for you to dispute information, we highly recommend you dispute via certified mail with return receipt.
  • Use the dispute forms provided by the credit bureau or employment screening company.
  • If there are no forms provided for submitting disputes, follow closely any instruction they provide on what to include in your dispute mailing. In general, be prepared to provide proof of identification, details of the item(s) you are disputing, and supporting documentation. If you are disputing through an employee screening service, be prepared to provide the name of the employer that requested the report, date the report was issued, and report reference number.
  • If you are disputing an item with one of the big three credit bureaus, refer to this dispute letter template that you can edit according to your unique circumstances. (You may want to use it for reference when disputing with an employment screening company. Just be sure to edit it very carefully so that it reflects a reference to your consumer report from an employment screening company, not a credit report from a credit bureau.)

How to contact companies that provide consumer reports to employers

Credit bureaus

The big three credit bureaus provide credit reports directly to employers. They also provide credit information to employment screening services. So no matter which type of company an employer uses to check your credit, checking the accuracy of your credit reports through Experian, TransUnion, and Equifax is of the utmost importance.

You can request your reports from the big three bureaus through AnnualCreditReport.com, where you can order free copies from each bureau every 12 months. Beyond that, you can monitor your credit reports (and scores) through free credit monitoring sites year-round.

Below is the contact information you’ll need for submitting credit disputes through the credit bureaus.

Experian

You can dispute information in your Experian credit report:

  • By mail (which we recommend):

Experian
P.O. Box 4500
Allen, TX 75013

See Experian dispute instructions.

TransUnion

You can dispute information in your TransUnion credit report:

  • By mail (which we recommend):

TransUnion
Consumer Dispute Center
P.O. Box 2000
Chester, PA 19016

  • By phone: 800-916-8800
  • Online

See TransUnion dispute instructions.

Equifax

You can dispute information in your Equifax credit report:

  • By mail (which we recommend):

Equifax
P.O. Box 740256
Atlanta, GA 30374

  • By phone: 866-349-5191
  • Online

See Equifax dispute instructions.

Employment screening services

In addition to the information included in your credit reports from the big three bureaus, background checks provided by employment screening services may provide employers with your:

  • Employment history (employers, job titles, salary, and dates of employment)
  • Education records
  • Driving records
  • Vehicle registration
  • Court records
  • Sex offender records

Information employers have access to varies by state. Learn more about background checks from the U.S. Equal Employment Opportunity Commission.

Below is the contact information you’ll need for employment screening services commonly used by employers. Again, these companies may or may not have any information to disclose to you.

Accurate Background

You can request a copy of your Accurate Background consumer report:

  • By phone: 800-216-8024
  • By email: customer_service@accuratebackground.com

You can dispute information in your Accurate Background consumer report:

  • By mail (which we recommend):

Accurate Background
Dispute Department
7515 Irvine Center Drive
Irvine, CA 92618

  • By phone: 800-216-8024
  • By fax: 855-785-4434
  • By email: disputes@accuratebackground.com

See Accurate Background dispute instructions.

American DataBank

We could not find any specific information online for how to request a copy of your American DataBank consumer report. We called their toll-free number (800-200-0853) and were told that if a potential employer requests a background check on you then that employer will give you a unique website address where you can view your report.

You can dispute information in your American DataBank consumer report:

  • By mail (which we recommend):

American DataBank – Disputes
110 16th Street, 8th Floor
Denver, CO 80202

  • By phone: 303-573-1130 or 1-800-200-0853
  • By fax: 303-573-1298
  • By email: disputes@americandatabank.com
  • Online

See American DataBank dispute instructions.

backgroundchecks.com

You can request a copy of your backgroundchecks.com consumer report:

  • By mail:

backgroundchecks.com
Attn: Consumer Relations Department
P.O. Box 353
Chapin, South Carolina 29036

  • By phone: 866-265-6602
  • By fax: 866-306-9258

You can dispute the information in your backgroundchecks.com consumer report:

  • By mail (which we recommend):

backgroundchecks.com
Attn: Consumer Relations Department
P.O. Box 353
Chapin, South Carolina 29036

  • By phone: 866-265-6602
  • By fax: 866-306-9258

See backgroundchecks.com dispute instructions.

First Advantage

You can request a copy of your First Advantage consumer report:

  • By mail:

First Advantage Consumer Center
P.O. Box 105292
Atlanta, GA 30348-5292

  • By phone: 800-845-6004
  • By fax: 727-214-2127
  • By email: documents@fadv.com

You can dispute the information in your First Advantage consumer report:

  • By mail (which we recommend):

First Advantage Consumer Center
P.O. Box 105292
Atlanta, GA 30348-5292

See First Advantage dispute instructions.

General Information Services

You can request a copy of your General Information Services consumer report:

  • By mail:

General Information Services (GIS)
PO Box 353
Chapin, SC 29036

  • By phone: 866-265-4917
  • By fax: 866-265-4921
  • Online

You can dispute the information in your General Information Services consumer report:

  • By mail (which we recommend):

General Information Services (GIS)
PO Box 353
Chapin, SC 29036

  • By phone: 866-265-4917
  • By fax: 866-265-4921

See General Information Services dispute instructions.

HireRight

You can request a copy of your HireRight consumer report:

  • Online
  • By phone: 800-381-0645
  • By fax: 918-664-5520
  • By mail:HireRight
    Attn: Consumers Department
    14002 E. 21st Street, Suite 1200
    Tulsa, OK 74134

You can dispute the information in your HireRight consumer report:

  • By mail (which we recommend):HireRight
    Attn: Consumers Department
    14002 E. 21st Street, Suite 1200
    Tulsa, OK 74134
  • By phone: 866-521-6995
  • Fax: 918-664-5520
  • Online

See HireRight dispute instructions.

Info Cubic Background Checks

You can request a copy of your Info Cubic consumer report using this form:

  • By mail:

Info Cubic LLC
Attn: Compliance Department
9250 E Costilla Ave suite 525
Greenwood Village, CO 80112

  • By fax: 877-578-9558
  • By email: compliance@infocubic.com
  • Online

You can dispute the information in your Info Cubic consumer report using this form:

  • By mail (which we recommend):

Info Cubic LLC
Attn: Compliance Department
9250 E Costilla Ave suite 525
Greenwood Village, CO 80112

  • By fax: 303-220-0171
  • By email: compliance@infocubic.com
  • Online

See InfoCubic dispute instructions.

IntelliCorp

You can request a copy of your IntelliCorp consumer report using this form:

  • By mail:

IntelliCorp Records, Inc.
3000 Auburn Drive, Suite 410
Beachwood, Ohio 44122

  • By phone: 866-202-1436
  • By fax: 216-450-5279

You can dispute the information in your IntelliCorp consumer report using this form:

  • By mail (which we recommend):

IntelliCorp Records, Inc.
3000 Auburn Drive, Suite 410
Beachwood, Ohio 44122

  • By phone: 866-202-1436
  • By fax: 216-450-5279
  • By email: reinvestigation@intellicorp.net

See IntelliCorp dispute instructions.

OPENonline

You can request a copy of your OPENonline consumer report using this form:

  • By mail (which we recommend):

OPENonline LLC
Attn: Compliance
PO Box 549
Columbus, OH 43216-0549

  • By phone:888-381-5656
  • By fax: 614-481-6980
  • Email:compliance@openonline.com

You can dispute the information in your OPENonline consumer report using this form:

  • By mail:

OPENonline LLC
Attn: Compliance
PO Box 549
Columbus, OH 43216-0549

See OPENonline dispute instructions.

Pre-employ.com

You can request a copy of your Pre-employ.com consumer report using this form:

  • By mail:

MyBackgroundCheck.com
P.O.Box 491570
Redding, CA 96049-1570

  • By fax: 800-503-2371

You can dispute the information in your Pre-employ.com consumer report:

  • By mail (which we recommend):

Pre-employ.com
PO Box 491570
Redding, CA 96049

  • By email: compliance@pre-employ.com
  • Online

See Pre-employ.com consumer resource information.

Sterling Talent Solutions

You can request a copy of your Sterling Talent Solutions consumer report:

  • Online
  • By phone: 888-889-5248

You can dispute the information in your Sterling Talent Solutions consumer report:

By phone: 888-889-5248*

*Tell them you prefer to dispute by mail. Ask for an address, if there is a dispute form they would like for you to use, and what information they need for you to include.

See Sterling Talent Solutions consumer FAQs.

Trak 1

You can request a copy of your Trak 1 consumer report using this form:

  • By mail:

Trak-1 Consumer Disputes
7131 Riverside Parkway
Tulsa, Oklahoma 74136

  • By fax: 918-779-6521, ATTN: Consumer Disputes
  • By email: disputes@trak-1.com
  • Online

You can dispute the information in your Trak 1 consumer report using this form:

  • By mail (which we recommend):

Trak-1 Consumer Disputes
7131 Riverside Parkway
Tulsa, Oklahoma 74136

  • By email: disputes@trak-1.com
  • Online

See Trak 1 consumer FAQs.

The Work Number (from Equifax)

You can request a copy of your The Work Number consumer report using this form:

  • By mail:

Equifax Workforce Solutions
ATTN: EDR
3470 Rider Trail South
Earth City, MO 63045

  • By fax: 877-879-8182
  • By email: EDR@equifax.com
  • By phone: 866-604-6570

You can dispute the information in your The Work Number consumer report using this form:

  • By mail:

Equifax Workforce Solutions
ATTN: DISPUTE
3470 Rider Trail South
Earth City, MO 63045

  • By fax: 314-812-6822
  • By phone: 866-222-5880

See The Work Number dispute instructions.

Other credit reporting agencies

There are dozens of consumer reporting agencies that the Consumer Financial Protection Bureau says need to be on your radar. This includes the big three credit bureaus, as well as employment screening companies, but also agencies dedicated to tenant screening, check and bank screening, and more. What are these 46 consumer reporting agencies saying about you?

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Using Credit Karma to Monitor Your Credit: How It Works and Why You Need It

September 26th, 2017 · Credit Reports, Credit Scores

Using Credit Karma to Monitor Your Credit: How It Works and Why You Need ItHow does Credit Karma offer its credit monitoring services for free? Which credit bureaus do they pull from? Which scores do they use and are they accurate? Get answers to these and other questions about Credit Karma, one of the more popular services you can use to monitor your credit, during the credit repair process and beyond.

How Credit Karma works

Credit Karma is one of many free credit monitoring services. It pulls information from the credit bureaus and provides you with your credit reports and scores on a regular, year-round basis. This makes it a great supplement to the free reports you only get once a year through AnnualCreditReport.com.

Which bureaus Credit Karma uses

Unlike other free credit monitoring sites that only provide you with information from one credit bureau, Credit Karma provides you with information from two – TransUnion and Equifax. This unique feature alone makes Credit Karma a valuable credit monitoring tool. (Obviously, you want to monitor your Experian report and score as well, which you can do for free through Credit.com; it’s also free.)

Which score Credit Karma uses

All credit scores are based on information in credit reports – three-digit numbers generated by algorithms used by the credit bureaus. In the case of Credit Karma, the credit scores you see will be based on the information in your TransUnion and Equifax reports.

One important distinction to make about Credit Karma scores is that they are VantageScores, not FICO Scores. Users who don’t understand this often assume the scores Credit Karma shows them are inaccurate because they don’t match up with the FICO Scores they see from other sources.

While FICO Scores are far more widely used by lenders than VantageScores, this doesn’t mean the scores you see through Credit Karma are any less valuable in terms of credit monitoring. They will not only give you a good idea of your credit health at any given point, but can also show you how your credit repair efforts are impacting your score over time.

What Credit Karma shows

Once you’re signed into your Credit Karma account, there are four places where you will find information about your credit reports and scores, as well as credit offers tailored to those reports and scores.

Dashboard

This is a very general credit overview, showing:

  • Your TransUnion VantageScore
  • Your Equifax VantageScore
  • The last time these scores were updated
  • Option to see score details

You’ll also see a suggested credit offer based on your current credit score.

Score Details

In the top right-hand corner of the page, you will see the option to choose between score details for TransUnion or Equifax.

For each, you will see:

  • Your VantageScore
  • Graph showing your VantageScore over previous months
  • Credit factors*
    • Credit card use (i.e., credit utilization ratio)
    • Payment history showing the percentage you have paid on time
    • Number of derogatory marks (e.g., collections, judgments, tax liens, bankruptcies)
    • Credit age representing average length of time your current accounts have been open
    • Total accounts (both open and closed)
    • Number of hard inquiries

*You will have the option of clicking through to view details of these credit factors where you can see specific accounts, derogatory marks, and hard inquiries, among other things.

  • Credit report details with an option to print your report

You’ll also see a suggested credit offer based on your current credit score.

My Recommendations

This is where you will see targeted credit offers recommended for you based on your current credit score. These recommendations will include:

  • Name of the credit issuer
  • Your approval odds
  • Details, rates, and fees
  • Option to apply now

Just keep two things in mind about these offers. One, just because a credit offer is recommended to you that doesn’t mean you automatically qualify. And two, there may be better offers out there that are not reflected on the Credit Karma site. So before you apply, pay attention to the approval odds and shop around first.

Accounts

In the top right-hand corner of the page, you will see the option to choose between score details for TransUnion or Equifax.

For each, you will see:

  • Number of accounts
  • Total open balances
  • Credit cards balance
  • Real estate balance
  • Auto loans balance
  • Student loans balance
  • Other loans balance
  • Collections balance

You will also see a list of specific accounts, which includes the last reported date, the balance, and the account status.

How often it updates

Credit Karma updates every 7 days. This means that there will always be a week’s worth of updates that may not be reflected in the reports and scores you see there. (For daily updates, use WalletHub; it’s also free. It only pulls from TransUnion, but it will give you the best reflection of where you credit stands in real time.)

Why Credit Karma is free

Like many other credit monitoring services, Credit Karma is free to you because of its partnerships with companies offering financial products on its site. If you apply and are approved for a credit card or loan through Credit Karma’s recommendations, they receive a commission.

As stated on Credit Karma’s website, “These offers may include refinancing options if you look like you might be overpaying for a loan, or credit cards that could help you optimize your savings and earnings.”

How to sign up

In order for anyone to access your credit reports and scores, they must have permissible purpose. You grant this to creditors every time you apply for a loan. The same is true if you apply for insurance or a cell phone or any other type of service that does a credit check first. Permissible purpose also applies to credit monitoring services like Credit Karma.

To sign up for Credit Karma, you will need to create an account and provide them with personal information to verify your identity. With this information, they can gain access your TransUnion and Equifax credit files.

Note, in the wake of the Equifax hack, experts and regulators advise that you place a credit freeze on your credit reports. Just be sure to sign up for credit monitoring first – whether it’s Credit Karma or not – as they will not be able to access your files once the freeze is in place. This is true of any other credit monitoring site, as well as creditors, lenders, and the like. If you’ve already placed the freeze, but still need to initiate credit monitoring, you will need to use the PIN provided by the bureau(s) to lift the freeze temporarily. (The same is true anytime you need to have your credit accessed when applying for a product or service that requires a credit check.)

Credit Karma credit offers

One of many ways to improve your credit score is to increase your available credit. While you do not want to take on debt just for that reason alone, a new credit card, for example, that you pay off every month, could help boost your score.

As already mentioned, you will see credit offers appear throughout the Credit Karma website. However, you can also search these offers by loan type.

For credit cards, you can search those specific to:

  • Balance transfers
  • Low interest
  • Rewards
  • Cash back
  • Airline
  • Student
  • Business

For loans, you can search those specific to:

  • Personal loans
  • Home loans
  • Auto loans
  • Student Loans
  • Business Loans

You can also get quotes on auto insurance rates.

How to navigate credit offers

  • Look at approval odds. The last thing you want to do is apply for credit that you don’t get; you’ll not only be rejected, but a hard inquiry will show up on your credit reports. One hard inquiry won’t knock any more than five points off your score, but if you submit additional applications after the initial rejection, then you’re racking up multiple hard inquiries on your credit reports which doesn’t look good to creditors.
  • Look at details, rates, and fees. Getting approved for credit is a good thing, but just any old credit won’t do. If you’re not careful, you could end up with high interest rates and expensive fees that could have been avoided or, at the least, minimized. You could also end up with credit card rewards that you won’t even use.
  • Look at offers on other sites. While an offer you see on Credit Karma might be a great deal, you might find a better one somewhere else. So before applying, compare the offers you see on Credit Karma to those on other credit (and insurance) comparison sites (like Bankrate, NerdWallet, and WalletHub).

Credit Karma resources

In addition to credit monitoring and credit offers, Credit Karma provides other resources that could help you improve your credit or financial situation.

Credit score simulator

This tool will show you how your credit score could be impacted if you:

  • Get a new loan
  • Get a new credit card
  • Transfer balances to a new card
  • Close your oldest card
  • Have a credit application denied
  • Get a credit limit increase
  • Increase or decrease your balances
  • Let your accounts go past due
  • Go into foreclosure
  • Have your wages garnished
  • Have an account sent to collections

Credit calculators

If you’re not using credit calculators to see how much loan you can afford, you should be. On Credit Karma, you’ll find a:

  • Mortgage refinance calculator
  • Debt repayment calculator
  • Simple loan calculator
  • Amortization calculator

Spending tracker

This tool allows you to connect your bank and credit card accounts to Credit Karma. It will track your:

  • Net cash flow
  • Money spent by category
  • Individual transactions

Credit Karma also has articles, reviews, a community forum, and a blog.

Other free credit monitoring options

AnnualCreditReport.com

By law, you are entitled to see your credit reports for free – through all three credit bureaus – every 12 months. You can order all three reports all at once or you can stagger them throughout the year. To make this request, go to AnnualCreditReport.com. You can do it online, by phone (877-322-8228), or by mail with this form.

Services like Credit Karma

Credit Karma is just one of many free credit monitoring services you can sign up to use for regular, ongoing access to your reports and scores. Others include:

  • Credit.com – Experian credit report and VantageScore
  • WalletHub – TransUnion credit report and VantageScore (updated daily)
  • Credit Sesame – TransUnion credit report and VantageScore
  • Lending Tree – TransUnion credit report and VantageScore
  • myBankrate – TransUnion credit report and VantageScore
  • CreditCards.com – TransUnion credit report and VantageScore
  • Quizzle – TransUnion credit report and VantageScore (updated every 3 months)
  • Experian CreditWorks – Experian credit report (every 30 days)

Credit card companies

Some credit card companies also offer free credit scores. Discover and Capital One offer free credit scores to anyone – FICO through Discover and VantageScore through Capital One – whether you have an account with them or not. Your own credit card company may also provide you with an updated FICO score every month.

Special circumstances

You can see your credit report for free if:

  • You received an adverse action notice
  • You received a risk-based pricing notice
  • A change is made to your credit report due to a dispute
  • You have reason to believe your credit report is inaccurate due to fraud
  • You are unemployed and looking for work
  • You are receiving public welfare assistance
  • Your state offers a free credit report

Learn more about these free (as well as paid) credit monitoring options in our comprehensive post, 22 Ways to Monitor Credit Reports and Scores.

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