According to the credit literacy survey conducted by the TransUnion in July 2017, most of the people believed that checking the credit score of Credit karma USA affects the score.
Credit Karma is a free online service that allows individuals to check their credit scores. Checking the credit score on Karma Credit is considered a soft inquiry, and it doesn’t harm the credit score in any way. A soft inquiry is self-initiated, whereas the hard inquiry is when you apply for a loan or a new credit card. Unlike hard inquiries, soft inquiries don’t impact the credit score negatively. One can undoubtedly sign up on Credit Karma for business and personal credit purposes.
Below mentioned are the factors that affect your credit score negatively, which will help you understand things in a better way.
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Credit Card utilization.
Credit card utilization refers to the amount of available credit at a given time. This factor enables the creditors to estimate how much you rely on credit cards. Experts suggest keeping your credit card utilization low, which means you shouldn’t rely much on the credit cards. High credit card utilization negatively impacts your credit score.
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Derogatory marks.
Derogatory mark in an unwanted negative and longstanding mark on the credit reports. The things or events that can lead to derogatory mark on your credit report include:
• Late payment.
• Bankruptcy.
• Collections.
• Foreclosure.
Tax liens and civil judgments existed earlier, but are removed since July 2017.
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Payment history.
Another factor that makes a high impact on the credit score is payment history. Missed timelines or late payments will make the creditors feel that you’re unreliable and irresponsible. Thus, ensure that payments are made on time to keep up the credit score.
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Age of credit history.
Though less impactful, the age of credit history factor is worth considering. The age of your credit history speaks a lot about your personality. The longer the age of your credit history, the higher will be your worthiness to the creditors. This factor is important as it is considered while calculating your credit score.
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Hard inquiries.
As mentioned above, hard inquiries occur when you apply for a loan or a new credit card. The creditor or the lender usually checks your credit report before processing your application. This is called a hard inquiry. Though a hard inquiry affects the credit score, the impact is low and is temporary. Soft inquiries like checking the score on Credit karma USA, lender reviewing your account, etc. do not harm the credit score.
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Total number of accounts.
This factor refers to the total number of loans, credit cards, mortgages, and other things that you own. A high number of accounts means that the other lenders believe in you and make the creditor believe in you. Do consider Credit karma for business and personal requirements.
