Does Gambling Affect Credit Score
Sometimes life seems unfair, especially when we’re forced to drop our passion just to protect things like our finances. But before you go ahead and throw in the towel on gambling, hear us out first.
In this article, we are going to answer one of the core concerns of gamblers — the issue of gambling vs credit score, and hopefully by the end of this writeup, we would have succeeded in allaying your fears.
Can my gambling expenses taint my credit score?
Your credit score can’t be ruined by just your gambling activities. A credit score is simply a number that describes your creditworthiness. It calculates your ability to repay a loan if granted one. However, this score is not concerned with how you spend your money. As long as you don’t default on a loan, it’s all good.
All you need to do is to separate your gambling from any loan you want to take. Do not take a loan for gambling because you might lose a bet and instantly become unable to repay the loan. If you repay all your debts, your credit score will remain solid and you will have absolutely nothing to worry about.
Do I qualify for a loan as a gambler?
Generally, your gambling adventures will not influence your credit score negatively. However, if you want to enjoy unrestricted access to personal loans, then you must avoid certain harmful gambling practices.
You may find it tough to secure a personal loan if your gambling activities cause you to fall into your overdraft too often. Overdraft is a credit line that is offered by banks to assist customers to make transactions when their account balance cannot complete it. Your chances of getting a loan approved decrease even more if your access to the overdraft was not authorized.
If you use your credit card to fund your gambling activities, this will leave a dent in your credit score. The singular act of applying for an overdraft causes your score to drop by five points. So make sure that it doesn’t become a norm.
The worst thing you can do to your credit score is acquiring multiple credit cards just to fund your gambling habit, and the consequence of this is the inability to access personal loans in the future.
When a gambler gets to this point, a complete turnaround becomes a herculean task, and the credit score continues to go downhill rapidly, especially if the root cause of the problem, irresponsible gambling, is not addressed.
But in the case of a responsible gambler who bets only with their own money and also has a decent credit score, their loan request will not be denied. Even if it were, it will certainly not be because of gambling. Safe and responsible gaming ventures will not harm your credit score, so you can keep on gambling with a clear conscience.
Can gambling stop me from securing a mortgage?
Compared to other loan types, mortgage applications are reviewed more thoroughly, with banks checking the entire financial history of an applicant.
It’s not out of place for mortgage lenders to request bank statements of the previous five to six months to ascertain if you’ve been faithful in the payments of any past loans. They even go a step further to inquire about the spending habits of the applicant.
Now here lies the problem; if they were to see any payments to a gambling company, that might raise red flags and they’ll be more critical when viewing your history. And if it’s ever found that you took a loan to finance your gambling payments, then that’s the end of the road for that mortgage application.
To the mortgage lender, you cannot be trusted with money because you may squander it on gambling and repayment will become a problem.
Even if the bank statement shows that you regularly transfer your gambling winnings into your account, your association with a gambling service is all the evidence they need to conclude that you’re irresponsible financially.
However, if you can control your gambling habits, getting a mortgage at some point will be possible, if planned correctly. So, plan ahead for several months if you are thinking of getting a mortgage.
Tips to maintain a good credit score
Things To Do
- Always gamble responsibly.
- Fund your gambling with e-wallets or crypto as much as possible.
- If you’re a victim of gambling problems, seek professional help.
Things Not To Do
- Never borrow money to gamble.
- Do not be a co-owner of a credit card with an irresponsible gambler.
- Don’t submit a mortgage application until your bank statement can prove that you have a good spending habit.
The crux of the matter is that your credit score will remain good even as a gambler as long as you do not borrow money to place bets. It is totally possible to enjoy gambling, explore new and old favorite games, and win some amazing rewards, all this as long as you are doing it with safety in mind.
However, mortgage lenders look beyond your credit score and credit report when trying to determine if you’re worthy of their investment. So if you must gamble, ensure that it’s done with cash at least several months before submitting your mortgage application.
A credit score is simply a number that describes your creditworthiness and this score is not concerned with how you spend your money. As long as you don’t default on a loan, it’s all good.
To the mortgage lender, a person who uses his money gambling on sports or gambling is unreliable, because this indicates that the person may squander the money on gambling and then have no way to repay the loan. Even if your bank statement shows that you regularly transfer your gambling winnings into your account, your association with a gambling service is all the proof they need to conclude that you are financially irresponsible. However, if you can control your gambling habits, getting a mortgage at some point will be possible, if you plan correctly. Therefore, plan several months in advance if you are thinking about getting a mortgage.