Borrowell vs Credit Karma: Which Is Best?

For anyone who is interested in personal finance or travel hacking, knowing how to access and understand both your credit score and credit report is important.  This information is taken into account by financial institutions when you are applying for a new loan or credit card to better understand the risk associated with you as a consumer (or your ‘creditworthiness’).

There are two free credit score services that Canadians can use to access this information: Borrowell and Credit Karma. Since both of these credit monitoring services are free, people often ask which is better or which one they should rely on more. 

Let’s get into our review of both services so we can decide who wins in the battle of Borrowell vs Credit Karma.

Why Should I Check My Credit Score?

Your credit score is important because it is one factor that lenders look at when considering you for any sort of credit loan approval, like a credit card or a line of credit. A credit score can often be thought of as an indicator of your financial health from a lender’s perspective.

A good credit score means you’re more likely to be approved for a personal loan with a lower interest rate or for a specific credit card. On the other hand, a bad credit score can mean you’re likely to be denied a loan or a specific credit card.

Learn More: Credit Scores: Everything You Need to Know

Not only do you need to have a good credit profile to obtain unsecured personal loans, but your credit score is also important because it can impact your ability to get a mortgage, rent an apartment, get a cell phone plan, or even get utilities set up in your name. Understanding your credit score and credit report is the backbone of the financial lending system in Canada.

If you are new to the idea of credit cards, you might want to learn how credit cards work before diving deeper into the world of credit scores. Once you have that understanding, consider reading our beginner’s guide to miles and points.

What is a Good Credit Score?

In Canada, a credit score can be anywhere between 300 and 900.

Generally speaking, a credit score of 700 or higher is considered good. A score of 740 or higher is considered excellent. Anything below 660 would be considered not great, but workable.

The graph below is simply an approximation or guideline as to some of the thresholds as to what is considered good and great in Canada:

When it comes to credit scores, as long as you aim for over 700 you should be fine when it comes to credit card applications. That being said, remember they look at all aspects of your credit history and report when determining the risk in extending you additional lines of credit.

How is My Credit Score Determined?

There are five main aspects that go into your credit score:

• Payment history (35%)
  • This aspect looks at if you have made your payments on time for each individual credit line.
• Credit utilization (30%)
  • This aspect considers how much of your existing credit limit you are utilizing across all lines of credit.
• Length of credit history (15%)
  • This aspect looks at the actual age of your lines of credit; this may often be referred to as the average age of accounts.
• Types of credit in use (10%)
  • This considers the types of credit that you have on your credit report, such as installment loans or revolving credit.
• Inquiries on your report (10%)
  • This aspect considers how many hard inquiries or new requests you have for credit on your credit report.

Borrowell and Credit Karma will show you all of this information on your free credit report for the respective credit bureau that they are linked to (Equifax and Transunion respectively). These are both great tools for free credit score monitoring in Canada.

Borrowell: Check Your Equifax Credit Score

Borrowell Canada is an organization that offers free access to your Equifax credit score and report.

To get started with Borrowell, you just need to create an account and provide some personal information like your name, address, date of birth, and social insurance number. Borrowell will then pull your free Equifax credit report and give you access to it online. You can also download a PDF version of your credit report.

You can sign up for your free account on the Borrowell website here.

What Other Services Does Borrowell Offer?

In addition to free access to your Equifax credit score and report, Borrowell also offers other services like personal loans, credit cards, bank accounts, and articles on financial literacy.

Borrowell personal loans are available in amounts from $500 to $75,000 with variable interest rates depending on your credit score. In applying for a loan, you can choose a loan term of 12 to 60 months. Borrowell will do a soft credit check when you apply for a loan so it won’t impact your credit score. They may advertise these as debt consolidation loans as well, depending on how they are targeting you as a consumer.

Borrowell also offers an AI powered credit coach which can provide additional context and guidance surrounding your credit report. For example, you can learn more about your credit score, credit updates, and how you can improve your score.

Finally, Borrowell also offers free access to comparing financial products like credit cards and savings accounts. That being said, if you are looking for a new credit card I would recommend reviewing our credit card comparison tool to find the right card (with the best welcome bonus) for your wallet. Not to mention, you can earn additional cash back on your bank account and credit card sign-ups with FlyerFunds Rebates.

Credit Karma: Check Your Transunion Credit Score

Credit Karma Canada is a company that offers free access to your TransUnion credit score and report.

To get started with Credit Karma, visit Credit Karma’s website to create an account. You will need to provide some personal information like your name, address, date of birth, and social insurance number.

Once you verify all of the above information, Credit Karma will then pull your credit report from TransUnion and give you access to the report contents online, as well as your Credit Karma (TransUnion) score. You can also download a PDF version of your credit report if you would prefer to have a hard copy for your records.

Your sample credit report dashboard will look like the below:

From there, you can open your actual credit report which will show you all lines of credit open under your name, the last reported balance, payment history, and more.

You can sign up for your free account on the Credit Karma website here.

What Other Services Does Credit Karma Offer?

In addition to free access to your TransUnion credit score and report, Credit Karma also offers other services like personal loans, credit cards, mortgages, and articles on financial literacy.

Credit Karma personal loans are available for various amounts at variable interest rates. You will be able to see what offers are available to you by logging into your Credit Karma account. Credit Karma will do a hard credit check when you apply for a loan so this application will impact your credit score in the short term.

Credit Karma also offers the ability to easily compare credit cards that you may be eligible for based on your credit score. If you are looking for a new credit card I would recommend reviewing our credit card comparison tool to find the right card (with the best welcome bonus) for your wallet. Not to mention, you can earn additional cash back on your bank account and credit card sign-ups with FlyerFunds Rebates.

Borrowell vs Credit Karma: And The Winner Is…

So, who wins in the battle of Borrowell vs Credit Karma?

The reality is that there isn’t a clear winner. While both services offer free credit reports, they have their own competitive edge in that they each service one of the two major credit reporting agencies in Canada when it comes to obtaining your free credit score. With that in mind, it is worth signing up for a free account with both Borrowell and Credit Karma. ClearScore is also available to Canadians who are looking to access their Transunion credit report.

We believe it is important to have a good grasp of what your credit score is with both credit bureaus as different financial institutions will pull from Equifax and Transunion. This means that a credit application will only pull from one of the two credit bureaus, and thus, that hard check from the credit card application will only impact one of the two credit reports.

Not to mention, understanding which financial institution uses which credit bureau will go a long way in ensuring you are able to space out applications with certain institutions to increase your chance of being approved.

Conclusion

If you’re looking for a free way to check your credit score and report in Canada, we recommend creating both a Borrowell and Credit Karma account since they link to different major credit reporting agencies. Both tools are easily utilized to keep an eye on your credit history, credit report, and free credit score.

If you haven’t already, sign up for both Borrowell and Credit Karma today to see your free credit scores and where you stand on the credit spectrum.

Frequently Asked Questions