Most people are shocked when they find out that Credit Karma is not a credit monitoring site. They are actually a marketing and referral site. They purchased Vantage scores for pennies on the dollar to market to you a score that isn't really yours. They then market credit cards to you that you may have a "Very Good" chance of qualifying for based on a score that isn't true "The irony". When you click to apply for the card, Credit Karma get's paid $3 to $4 or more even if you get denied. If you actually get approved, they get upward of $30+ dollars per approval. Imagine having 3 million users applying for accounts through them quarterly with 33 percent getting approved. That FREE CREDIT MONITORING site just made at least $36 Million per quarter. This is why you see those commercials due to the huge marketing budget they have. So, be very careful in using the site for monitoring that is constantly marketing things for you to use inquiries on.
The REAL Truth
“Most Lenders will not use Vantage Score”
The Reality is, if you signed up for credit monitoring where you can view your scores for free, you are probably not looking at a score that the bank is going to pull. To be honest, you have 65 different FICO credit scores combined through all of the Credit Bureaus.
According to myFICO.com, each scoring model is primarily used for the type of credit account applied for. The most widely used version for personal loans is the FICO 8 score. Most of our clients scores are updated monthly with FICO 8 version scores. If they were to apply for a Mortgage on the same date, chances are, their scores will differ.
What is FICO
FICO stands for Fair Isaac Corporation, and it's used in the majority, if not all bank lending decisions. It is a different scoring algorithm than Vantage scores and the scores range from 300-850. Vantage scores are educational scoring models used primarily by Credit Karma and lots of other credit monitoring sites. When buying a home, it is fairly common that your Equifax Score will be the Equifax Facta Beacon 5.0, your Experian will most likely be an Experian Fair Isaac Version 2, and your Trans Union will more than likely be TU FICO Risk Score Classic 04.
“ By failing to prepare, you are preparing to fail. ”
You may want to make sure that you ask the lender to verify the version before having them pull your credit inquiry for a loan. It could be the difference of you getting a 3% mortgage or denied. We really hope this helps clear up some of the confusion that most consumers have about their scores and we hope you enjoyed your Weekly Boost prepared by Elevation Credit. That 900 score is in fact not 900. :)
We really hope this helps clear up some of the confusion that most consumers have about their scores and we hope you enjoyed your Weekly Boost prepared by Elevation Credit. That 900 score is in fact not 900. :)