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Why Credit Karma manipulates "payment history."

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Anonymous
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Why Credit Karma manipulates "payment history."

I've been thinking about this recently and it sort of irritates me.  As most people know, Credit Karma's pretty "fluff" software likes to paint a misleading picture for its members.  Aside from the non-FICO scores (which many people don't realize are unmeaningful) I'd like to discuss the "Payment History" section under score details/credit factors.

 

Many are aware that this graphic only takes into account the last 2 years of payment history:payment history.jpg 

We do know of course that any payment history shortcomings are typically present on a credit report for 7 years and adversely impact both FICO scores and VS 3.0 scores for longer than 2 years.  The graphic above also suggests due to it's color-coding that 99% payment history (even in the last 2 years) may be just as good as 100% payment history.  99% by definition means that a payment was missed and of course any profile with a missed payment isn't going to be as good as that same profile without a missed payment.

 

So, why does CK choose to provide us with this pretty little image?  Well, like 99 out of 100 questions in life the answer to this one IMO is "money."  We know that CK makes money through advertising products such as credit cards and loans.  Disclaimers throughout their pages do disclose this:

 

Suggested for your credit
We suggest offers based on your credit profile, Approval Odds, and money we make from our partners.
 
My personal opinion is that when people see that a pretty little fluff graphic that shows they have "100% payment history" they feel better about their profile, which may actually be extremely dirty over 2 years ago.  Because they feel better about their profile, they're more inclined to apply for the products (CCs, loans) that are plastered all over every page you access from CK.  More clicking those links, more unnecessary apps, more funding for CK.
 
I understand it, as it's business, but standing in an informed place I see this as quite grimy; members are being manipulated to some degree in order for CK to profit.
 
This obviously isn't something that's going to change, but I feel it's a thread-worthy topic especially for those that may be newer to their credit journey that are using a tool like CK.  It's important to be informed about these things in order for the best decisions to be made.
Message 1 of 39
38 REPLIES 38
Anonymous
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Re: Why Credit Karma manipulates "payment history."

 


@Anonymous

Many are aware that this graphic only takes into account the last 2 years of payment history:payment history.jpg 

 

I did not know this! I noticed that an old utility bill CO (which I PFD'ed recently) was reporting 2 lates on my 3B Reports, but not on CK and often wondered why. When I finally pulled the 3B's, I was surprised to find those lates.

 

Message 2 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."


@Anonymous

I did not know this! I noticed that an old utility bill CO (which I PFD'ed recently) was reporting 2 lates on my 3B Reports, but not on CK and often wondered why. When I finally pulled the 3B's, I was surprised to find those lates.

 


I'm glad that you know now.  I too was fooled by this big time when I first started looking into credit in early 2016. 

Message 3 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."

CK is the poster child of a "buyer beware" type of site. It can be useful for bits of info, but overall can do a great disservice to the unwary by being little more than a veiled CC pusher. I can't imagine how many people have been fooled by the misleading "Approval Odds", now made even worse with what you posted BBS.

Message 4 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."

Hey BBS.  I have been thinking for some time about creating a thread called Credit Karma -- How to Use It.  It'd be nice for newcomers to have a go-to thread that would explain what Karma is really good for, and what they need to ignore.  If I do I will run it by you first.

 

Message 5 of 39
Pikaboo-icu
Valued Contributor

Re: Why Credit Karma manipulates "payment history."


@Anonymous wrote:

Hey BBS.  I have been thinking for some time about creating a thread called Credit Karma -- How to Use It.  It'd be nice for newcomers to have a go-to thread that would explain what Karma is really good for, and what they need to ignore.  If I do I will run it by you first.

 


 Great idea!!!

 

Wallet Hub is rotten at some things too-

I got an email alerting; " your score has dropped by 15 points"!!

I nearly had a melt down- I logged in and it had actually INCREASED by 6!

This is obvious click bait and should not be allowed.. 

 

I only use these as auxiliary score/report/alert options. Credit Sesame, Wallet Hub, Credit Karma

They really aren't very accurate or trustworthy when it comes to important data points. 

  


Message 6 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."


@AnonymousCK is the poster child of a "buyer beware" type of site. It can be useful for bits of info, but overall can do a great disservice to the unwary by being little more than a veiled CC pusher. I can't imagine how many people have been fooled by the misleading "Approval Odds", now made even worse with what you posted BBS.

Another common one is when their "simulator" tells you that adding a credit card will increase your credit score.  A member of this forum recently posted about CK telling him that he'd get a 70 point gain from adding a credit card.  Like the "Payment history" topic that I posted about above, the simulator is just another ploy to try and get people to apply for a CC.

Message 7 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."


@AnonymousHey BBS.  I have been thinking for some time about creating a thread called Credit Karma -- How to Use It.  It'd be nice for newcomers to have a go-to thread that would explain what Karma is really good for, and what they need to ignore.  If I do I will run it by you first.

 


I like that plan CGID and think that it would be very beneficial.  I wish MF allowed subtitles to thread titles, as something like "The Good and the Bad" would be a solid subtitle for the thread.  There are times when I write a thread title and either don't have enough characters, or when reading the thread title it can be interpreted multiple ways where a subtitle would sort of solve that issue.

Message 8 of 39
Subexistence
Established Contributor

Re: Why Credit Karma manipulates "payment history."

This is another one.

 

Captureaccount.PNG

You need to have at least 11 accounts to be in the green. Some people with OCD will need at least 21 to feel better. There's absolutely no reason related to scoring to get at least 11 acounts. I can understand something like 0-3 accounts being in the red but 0-10 doesn't make sense.








Starting Score: Ex08-732,Eq08-713,Tu08-717
Current Score:Ex08-795,Eq08-807,Tu08-787,EX98-761,Eq04-742
Goal Score: Ex98-760,Eq04-760


Take the myFICO Fitness Challenge

History of my credit
Message 9 of 39
Anonymous
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Re: Why Credit Karma manipulates "payment history."


@SubexistenceYou need to have at least 11 accounts to be in the green. Some people with OCD will need at least 21 to feel better. There's absolutely no reason related to scoring to get at least 11 acounts. I can understand something like 0-3 accounts being in the red but 0-10 doesn't make sense.

I mostly agree with what you're saying above, especially with respect to 21+ being ideal according to the CK fluff chart.  Again, further manipulation of the member to always believe that "more is better" and with CC ads in your face at all times many people likely just say, "why not?" and apply unnecessarily

 

In another thread recently, though, I was discussing with TT the FICO negative reason statement, "too many or too few accounts."  This statement suggests that having not enough accounts or too many can adversely impact your FICO scores.  What these numbers are, though, we are unsure of.  TT had estimated that the sweet spot range could very well be in the 10-20 range, where that reason statement may be generated at values below 10 or over 20.  That being said, I (and probably TT, too) don't believe that any penalty associated with too many or too few accounts is significant; perhaps it impacts score 5 points or so... but of course, that could be profile-dependent.

Message 10 of 39
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