What ChatGPT Thinks About Credit Karma

I’ve been doing a little research with the help of ChatGPT. I asked a series of questions, and here’s what ChatGPT thinks about Credit Karma. The answers might surprise you.

What is Credit Karma?

I asked ChatGPT: “What is Credit Karma?”

“Credit Karma is a free online service that provides various services related to credit and finance, such as credit reports, scores, monitoring, ID monitoring, unclaimed property, financial product offers, tax preparation, savings accounts, and more. Credit Karma uses your credit profile to show you curated recommendations. Plus, you can see your Approval Odds before you apply without impacting your scores. Credit Karma offers free credit reports and free credit scores from Equifax and TransUnion, two of the three major consumer credit bureaus. Credit Karma is an American multinational personal finance company founded in 2007, which has been a brand of Intuit since December 2020.”

How does Credit Karma make money?

ChatGPT said:

“Credit Karma makes money through product recommendations. It partners with lenders, banks, and insurance companies to feature personalized offers on each member’s dashboard. If a member decides to apply for a recommended product and gets approved, Credit Karma is compensated. Credit Karma also makes money by charging referral fees, interest on cash, and interchange fees.”

Has Credit Karma ever had a data security incident?

ChatGPT said:

“Yes, Credit Karma has had a data security incident in the past. In October 2019, Credit Karma’s Identity Monitoring feature revealed that some users’ passwords were exposed in a data breach. Credit Karma advised users to change their passwords as soon as possible and to create strong passwords for any new or existing accounts.”

What are the Credit Karma Terms of Service?

Next, I asked: “Can you summarize the TOS page?”

“Sure, I can summarize the TOS page for you. Here are the main points”:

• The TOS page is a legal agreement between you and Credit Karma, LLC, which provides various free services related to credit and finance, such as credit reports, scores, monitoring, ID monitoring, unclaimed property, financial product offers, tax preparation, savings accounts, and more.
• By using Credit Karma’s services, you agree to their terms of service, privacy statement, additional terms (if applicable), and community rules.
• You need to create a Credit Karma account to access most of their services, and you are responsible for keeping your account secure and accurate.
• You can only use Credit Karma’s services for your personal and non-commercial purposes, and you must comply with all applicable laws and regulations.
• Credit Karma owns or licenses all the content, features, tools, data, software and functions that make up their services, and you are not allowed to copy, modify, distribute, or otherwise infringe on their intellectual property rights.
• You can contribute to Credit Karma’s community by posting comments, reviews, questions, answers, or other content, but you must follow their community rules and respect the rights of others.
• Credit Karma may monitor and disclose your activity on their services for administrative and legal reasons, such as to ensure compliance with their terms of service, protect their rights and property, or cooperate with law enforcement authorities.
• Credit Karma does not guarantee the accuracy, completeness, timeliness, or availability of their services or any third-party products or services that they recommend or link to. You use their services at your own risk and discretion.
• Credit Karma is not liable for any damages or losses that may arise from your use of their services or any third-party products or services that they recommend or link to. Their liability is limited to the maximum extent permitted by law.
• You agree to indemnify and hold harmless Credit Karma from any claims or disputes that may arise from your use of their services or violation of their terms of service.
• You agree to resolve any disputes with Credit Karma through binding arbitration on an individual basis, which means you waive your right to sue them in court or join a class action lawsuit.
• You can deactivate or terminate your Credit Karma account at any time by following the instructions on their website or contacting them. Credit Karma may also deactivate or terminate your account for any reason at their sole discretion¹.
• The terms of service are governed by the laws of California and the United States. If any part of the terms of service is found to be invalid or unenforceable, the rest of the terms will remain in effect.

Are the Terms of Service favorable to me?

I asked ChatGTP: “Are the Terms of Service favorable to me?” It replied:

“I’m sorry, but I cannot provide an opinion on whether the terms of service are favorable to you or not. The terms of service are a legal agreement between you and Credit Karma, LLC, and it’s important to read them carefully before using their services. If you have any questions or concerns about the terms of service, you can contact Credit Karma’s customer support team for assistance.”

What are the alternatives to Credit Karma?

So far, what ChatGPT thinks about Credit Karma has been helpful. But obviously it cannot provide a legal opinion, especially regarding my personal situation. So I asked what are my alternatives? ChatGPT replied… “There are several alternatives to Credit Karma that you can consider. Here are some of them”:

• WalletHub: WalletHub is a free credit monitoring service that provides daily updates to your credit score and report, alerts for changes to your credit report, and personalized advice on how to improve your credit.
• Credit Sesame: Credit Sesame is a free credit monitoring service that provides access to your credit score and report, alerts for changes to your credit report, and personalized recommendations for loans and credit cards.
• Credit.com: Credit.com is a free credit monitoring service that provides access to your credit score and report from Experian, as well as personalized recommendations for loans and credit cards.
• Equifax: Equifax is a paid credit monitoring service that provides access to your credit score and report from all three major credit bureaus, as well as alerts for changes to your credit report, identity theft protection, and more.
• TransUnion: TransUnion is a paid credit monitoring service that provides access to your credit score and report from all three major credit bureaus, as well as alerts for changes to your credit report, identity theft protection, and more.

What are the pros and cons of using Credit Karma?

The final question I asked: What are the pros and cons of using Credit Karma?

ChatGPT replied: “Credit Karma offers a wealth of financial resources to users. The site’s primary function is to monitor credit scores and provide users with insights into their finances. With Credit Karma, users can check their credit score for free, and can explore different credit cards and loans that may be available to them. Here are some pros and cons of using Credit Karma”:

Pros:

• Credit Karma is free to use and provides access to your credit scores from TransUnion and Equifax.
• Credit Karma offers a high-yield savings account with an impressive 2.73% annual percentage yield (APY).
• Credit Karma provides personalized recommendations for credit cards, loans, and other financial products based on your credit profile.
• Credit Karma offers early access to direct deposit paychecks.
• Credit Karma has a user-friendly interface that makes it easy to navigate and understand your finances.

Cons:

• Credit Karma uses the VantageScore 3.0 credit scoring model, which may differ from the FICO score used by many lenders.
• Credit Karma may show you ads for financial products that you don’t need or want.
• Credit Karma may not be able to provide you with all the information you need to make informed financial decisions.

Does Credit Karma offer a high-yield savings account?

I noticed something that seemed a little off in the Credit Karma list of “pros”, so I asked another question related to it… “Does Credit Karma offer a high-yield savings account?”

“Yes, Credit Karma offers a high-yield savings account. According to Credit Karma, their high-yield savings account offers a 0.30% APY as of June 2021, which is significantly higher than the national average of 0.42%. The account features a simple application process, no minimum balance requirements, and no fees. Credit Karma says it will leverage its bank partner network to optimize the rates members receive.”

That answer seemed a little odd, since in the list of pros and cons, it said the APY was 2.73%.

ChatGPT is not very good at explaining anything that is time sensitive. The sands of time are always shifting.

What’s the bottom line?

AI chatbots like ChatGPT (and other artificial intelligence chatbots) can sometimes make factual errors, and “spout falsehoods, which is described as hallucination, confabulation, or just plain making things up”. Another thing I observed is that ChatGPT gets confused about scope and boundaries, and tends to conflate things that are actually separate entities. Credit Karma does not help with tax preparation, but their parent company, Intuit, offers Quick Books for accounting, and Turbo Tax for tax preparation.

Interest rates fluctuate. It’s best to check the Credit Karma website directly for the most up to date information, and you’d have to visit their website anyway before signing up.

Are you interested in finding happiness? Money can’t buy happiness, but getting out of debt may actually make your brain work better. Getting rid of debt doesn’t just unburden finances, it takes a weight off the mind that clears up cognitive functioning, lessens anxiety and improves impulse control.