You Owe $49? Everything You Need to Know About the Credit Karma Settlement If you ever got a “pre-approved” credit card offer from Credit Karma between February 2018 and April 2021, this is for you. A recent settlement could mean you’re due $49. Let’s get into the details to see if you qualify and what to do.
What’s the $49 Credit Karma Settlement About?
The Federal Trade Commission (FTC) said Credit Karma was lying. Many users were told they were “pre-approved” for credit cards and then denied after applying. That wasted their time and hurt their credit scores from hard inquiries.
To make it right, Credit Karma is paying out $2.5 million as part of the settlement. If you were affected, you might be eligible for $49. Here’s how it works.
Who Gets the $49?
You’re probably eligible if:
- You applied for a credit card after getting a “pre-approved” offer from Credit Karma between February 2018 to April 2021.
- Your application was denied despite the “pre-approved” promise.
But if you didn’t apply for the card or weren’t denied, you probably won’t qualify. Make sure to check your eligibility before moving forward.
How to Check If You’re Eligible?
Here’s a step-by-step guide to check if you qualify for the $49 settlement:
- Look for Official Notices
Keep an eye on your mailbox or email. The settlement administrator will send notices to eligible individuals. These notices will have instructions on how to claim your payment.
- Go to the Official Settlement Website
Head to the official settlement website. There you’ll find tools to check your eligibility by entering your info.
- Check Your Credit Report
If you think you applied for a card during the eligibility period, check your credit report for hard inquiries. You can get a free copy from AnnualCreditReport.com .
- Contact the Settlement Administrator
If you’re not sure about your status or haven’t heard anything, reach out to the settlement administrator. Their contact info is on the settlement website.
How Will You Get Your $49?
Once you’re eligible, you’ll have two options to get your $49:
Option 1: Check
Your $49 will be mailed to you. Make sure to cash or deposit within 90 days or it will expire.
Option 2: PayPalDigital?
Choose PayPal. Cash or deposit within 90 days. Digital? Accept within 30 days.
Important Dates
Don’t miss:
- Checks: Must be cashed within 90 days.
- PayPal Payments: Must be accepted within 30 days.
Act fast so you don’t miss out.
Why This Matters?
$49 may not seem like a lot but it’s a big deal. For many it’s a small form of restitution for wasted time and effort.
The settlement also sends a message to companies about transparency in advertising especially when it comes to financial products that affect people’s lives.
How Credit Karma’s Practices Hurt Consumers?
Credit Karma’s “pre-approved” offers gave many people false hope. They led consumers to believe they were guaranteed approval only to be rejected later. This caused disappointment and hard inquiries on their credit reports which can lower credit scores.
Note the difference between “pre-approved” and “pre-selected”. “Pre-approved” means you’re eligible. “Pre-selected” means you were targeted based on certain criteria not guaranteed approval.
Tips to Avoid Similar Scams in the Future
Here are some practical tips to protect yourself from credit card offers:
- Read the Fine Print: Always review the terms and conditions of any offer. Look for phrases like “pre-selected” which means you’re not guaranteed approval.
- Check Your Credit Score: Before applying know where you stand financially. Many platforms including Credit Karma offer free credit score services.
- Be Skeptical of Unsolicited Offers: If it sounds too good to be true it probably is. Research the offer thoroughly before applying.
- Apply Only When Confident: Don’t apply for multiple cards in a short period. Each application results in a hard inquiry which can hurt your credit score.
FAQs
Q1: How do I know if I got a “pre-approved” offer from Credit Karma?
You probably did if the communication said you were eligible for a specific card using terms like “pre-approved” or “pre-selected”.
Q2: What if I didn’t get a letter about the settlement?
Even if you didn’t get a notice visit the official settlement website to check your eligibility. You can also contact the settlement administrator for help.
Q3: Can I claim more than one payment?
No, one $49 payment per eligible individual even if you got multiple offers.
Q4: What if I miss the deadline to cash my check or accept PayPal?
Missed deadlines may void your payment. Contact the settlement administrator to see if exceptions can be made.