March 28, 2024

Credit Karma Credit Builder Review

Read more about Credit Karma
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Building credit can be simple. Credit Karma makes it easy without fees. But is there anything to look out for? Read on to find out.

5-point scale (the higher, the better)

Pros and Cons

  • No fees
  • Reports to 3 credit bureaus
  • No lock-in period
  • Credit score must be 619 or below
  • Can't access savings immediately

Bottom Line

Free credit builder that helps you build savings worth $500 or more

Your credit history may be thin, with your credit scores less than ideal. Plus, there's not a lot of options to build credit.

What do you do?

Luckily, you can try out Credit Karma's Credit Builder. It can help you build your credit history for free, which can help you improve your credit scores.

Keep reading to find out how. You'll also learn all about its pros and cons and how it compares to its alternatives.

What is Credit Karma Credit Builder?

Credit Karma Credit Builder is a credit builder that lets you build credit and savings simultaneously. You get to open a savings account and a $1,000 line of credit with it.[1]

The credit builder reports your payments to Equifax, Experian, and TransUnion every month. And it has helped thousands of users boost their credit scores.

On average, users have increased their credit score by 21 points within 4 days of opening the credit builder.[2]

Having said that, this credit builder isn't the best for everyone.

Who Is It Best For?

Credit Karma is ideal for those looking to build savings and credit flexibly. However, your TransUnion credit score must be 619 or below to start using the credit builder in the app.

Also, you should be comfortable locking up your money until you've saved $500. You can't access your funds until it reaches this threshold.

If you don't meet the eligibility requirements, you can check out credit builder apps and credit builder loans instead.

Pros and Cons

If you're still on the fence about using the app, the upsides and downsides may help you decide.


  • Reports to the three credit bureaus
  • No setup fees, monthly fees, or interest fees
  • No hard pull on your credit
  • Has credit monitoring features
  • Cancel anytime without penalties
  • No fixed term length; transfer savings anytime as long as your account remains active
  • AutoSave feature; automatically transfers your chosen amount from the credit line to the savings account each pay period

You can keep your credit builder open as long as you want. However, you must transfer from your credit line to your savings account, and pay the outstanding balance to keep your account active.


  • Credit score must be 619 or lower to apply
  • Monitors VantageScore only (instead of FICO Score)
  • Poor customer service
  • Limited credit builder reviews
  • You can't access your savings until it reaches $500
  • You can only use your credit line to transfer to your savings account; you can't use it outside Credit Karma

How far off is Credit Karma from your actual score?
Credit Karma shows you your VantageScore instead of your FICO score. Both credit scores can differ by as much as 25 points or more. That said, it's best to note both credit scores, especially if you're applying for a loan or you want to keep building good credit.

How Does Credit Karma Credit Builder Work?

You can build your credit with Credit Karma by making timely payments for your credit line. That said, you get a credit line and savings account in your name.

Here's a step-by-step of how it works:

  1. Open the Credit Builder within your Credit Karma account.
  2. Transfer your chosen savings amount (minimum of $10) from the credit line to your savings account.
  3. Pay the amount you've transferred during the statement period. Then, Credit Karma reports your payments to Equifax, Experian, and TransUnion.

You can transfer funds as many times as you want. Just make sure that you pay on time since Credit Karma reports your transactions every month.

Every time you accumulate $500 in your savings account, it becomes available for use. But you can always keep it in your account to build more savings over time.

How do I cancel my Credit Karma Credit Builder?
You can cancel your credit builder anytime without worrying about penalties or charges. Just contact (888) 236-5798. However, note that closing your credit builder can hurt your credit since it can result in a decrease in your credit limit and average credit line age.

If you think Credit Karma certainly makes it easy to build credit, here's how much it can cost you to get started.

Pricing and Fees

Credit Karma Credit Builder is free! It has no monthly fees. And you don't need to worry about interest. However, you must do one of two things to start using the credit builder:[3]

  • Make a direct deposit of at least $750 to your Credit Karma account. Do this 2 months before you apply or within 1 month and 90 days after your application.
  • Set up a scheduled regular direct deposit within the app.

If that sounds easy enough, here are the other features you'll get to enjoy after opening an account.

How crucial is fee-free service when picking a credit-building tool?


Automated Savings
You can set an automated transfer from your credit line to your savings account every period. This can make it easier to build your credit since you can "set it and forget it."

Just make sure you don't forget to actually pay back the amount.

Credit Monitoring
Credit Karma offers free credit monitoring within the app. This way, you can keep track of any changes in your credit reports. This also helps you watch out for suspicious activities that may affect your credit.

Real-time Alerts
Get notifications in real time when important changes show up in your credit report. For example, you can get notified of hard inquiries or newly opened accounts.

Personalized Tools
Credit Karma provides curated tips to improve your credit. You may also get personalized recommendations for credit cards and loans based on your credit profile.

Is Credit Karma Credit Builder Any Good?

Credit Karma can be worth trying since it offers a flexible way to build credit. You can start using your credit line for as little as $10. In the end, you get your money back in the savings account.

However, Credit Karma falls short on customer service. Plus, you may see a difference in credit scores since Credit Karma only monitors VantageScore.

But unlike other credit builders and credit builder loans, you don't need to save every month. You can transfer from your credit line as many times as you want as long as you pay it on time. You get the chance to build credit and savings simultaneously with no fees.

If all of its perks have convinced you, here's how you can get started.

What's your main concern about using online services for credit-building?

How To Open An Account

Credit Karma does not perform a hard credit check. So, signing up for an account won't affect your credit.

Here's how you can open an account:

  1. Create an account on the sign-up page.
  2. Fill in your first name, last name, reason for joining Credit Karma, SSN, and birthday.
  3. Confirm your account.

Before you sign up, however, take note of Credit Karma's requirements.

Credit Karma Credit Builder Requirements:[4]

  • Be at least 18 years of age
  • Have a valid U.S. Social Security number
  • Only register for yourself
  • Make sure your information is updated

Can Credit Karma be trusted?

Yes, you can trust Credit Karma. It has millions of users worldwide, with over 2.7 million ratings from its Android app and over 6.5 million ratings from its iOS app.

In addition, Credit Karma has raised its users' credit scores by over 21 points on average. These numbers give the app a solid track record you can count on.

Speaking of numbers, here are the ratings and reviews from some of Credit Karma's customers.

Customer Service and Reviews

Rating SourceAverage Rating
Apple App Store4.8 out of 5 ★ from over 6.5 million ratings
Google Play Store4.4 out of 5 ★ from over 2.7 million ratings
Trustpilot1.4 out of 5 ★ from over 500 ratings

Although Credit Karma has millions of reviews and ratings, there are only a handful of reviews talking about its credit builder.

It's more popular as a free credit monitoring app with tracking features and credit reports. Uzeme's recent feedback shows this.

"I love CK. It's totally free and they really help your credit building journey. They send very helpful mails regularly." (From Trustpilot review)

On the other hand, Carly commends Credit Karma's tools and real-time alerts.

"Such a great app to monitor your credit, and alert you when there is a hard credit inquiry, I'm really impressed how quickly they notify you after having a run-in with identity theft." (From Trustpilot review)

It's not all good reviews, however. In recent years, remarks have been made about poor service, unreliable credit scores, and low data security. Here's Nicole's experience as an example.

"Their customer service isn't equipped to help you and will call saying you have questionable charges on your account and authorize them anyway. When you try to file a dispute they say they'll forward you to another department and youre dead in the water…" (From Trustpilot review)

If you encounter issues yourself, need your money right away, or want to close your credit builder account, you can:

If the credit builder just isn't worth it based on negative feedback, there are options below that you can consider.

How Credit Karma Credit Builder Compares

Credit Karma vs Cheese
Cheese is the most similar to Credit Karma's credit builder. It offers a credit builder loan that lets you choose between $500, $1,000, and $2,000 loan amounts.

Terms can last for 12 or 24 months. And just like Credit Karma, Cheese reports to Equifax, Experian, and TransUnion. You also get your money back, given that it's a loan.

That said, Cheese locks you within your chosen loan term. And you must account for the APR. This makes Credit Karma more flexible since with Credit Karma, you can build savings and credit as long as your account is open and active.

Credit Karma vs Kovo
Kovo is a simple credit builder that costs $10 monthly and gives you access to digital courses. It reports to the three main credit bureaus, like Credit Karma.

Unlike Credit Karma, however, Kovo monitors your FICO score. Plus, you're only building credit, not your savings. This means you don't get your money back.

In addition, you must commit to a lock-in period of 24 months. Generally speaking, Kovo is better if you are not eligible for Credit Karma's credit score requirement.

Credit Karma vs Kikoff
Kikoff costs $5 per month and gives you access to a $750 line of credit.[5] Instead of transferring to a savings account, however, you can only use the credit line to buy items from the Kikoff Store.

That said, Kikoff may be a more affordable option than Credit Karma. Plus, you don't need a credit score of 619 and below to start using the credit builder app.

But unlike Credit Karma, Kikoff's credit line only reports to Experian and Equifax.

Bottom Line

Credit Karma offers an affordable tool to help build your credit. It's also one of the most popular credit monitoring tools that can help you track your credit reports and credit score.

What's more, Credit Karma's credit builder is low-risk. You can improve your payment history with as little as $10.

The best part is you get to build your savings while you build your credit. Because you can only use the credit line with your savings account, you won't need to worry about taking on debts that can get out of hand.

Before reading this article, how familiar were you with Credit Karma's credit-building tools?


  1. ^ Credit Karma. How big is my Line of Credit?, Retrieved 01/31/2024
  2. ^ Credit Karma. Credit Karma Money Credit Builder, Retrieved 11/26/2023
  3. ^ Credit Karma. How to get the Credit Builder Plan Started?, Retrieved 01/31/2024
  4. ^ Credit Karma. Terms of service, Retrieved on 11/27/2023
  5. ^ Kikoff. Pricing, Retrieved 01/31/2024

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Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.


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