Will Online Gambling Affect My Credit Score?


gambling-mortgages-ukSince the financial crisis of 2008, banks and lenders are beginning to dip their hands in their pockets and approve loans and mortgages.

It’s the best time for some years for UK residents to borrow cash – but how good is the situation for gamblers?

UK banks are more stringent with their affordability and credit tests, but lenders can vary wildly. Let’s see how you can get the best deal with your bank.

Applying For a Mortgage


The major banks and building societies are starting to lend more to borrowers with good credit and a hefty deposit. Some banks will examine everything going in and out of your bank account, and those will typically dish out the best interest rates. Other lenders might not be as stringent.

The important thing is to get a good mortgage broker. They can do all the relevant checks first before recommending you to a bank. The broker will also assess your gambling for any pitfalls, however.

PROFESSIONAL GAMBLING:

If you’re a professional gambler, lenders will not look favourably on you if you are making your living from slots and sportsbetting. With no tax on UK gambling winnings, gamblers will effectively have no taxable income – and it doesn’t matter how well you’ve hit that jackpot on Mega Moolah.

Lenders don’t see gambling as a sustainable source of income (and even ‘skill’ games like poker are considered gambling). Some unsecure lenders will be more lenient on your information, but the interest rates could be higher.

One tip that professional gamblers use is to have a secondary source of income, like a part-time PAYE job with a contract. Gambling winnings can go towards a deposit while the contract can be used to apply for the mortgage itself.

CASUAL GAMBLING:

Even “hobby” gamblers can fall foul of the lenders. One mortgage broker told us:

“We have had a client turned down by a lender for spending a just a few hundred pounds a month or so on an online bingo website. ”

The key is how regular the gambling is. If you deposit £200-300 a month or more regularly into a casino online, the banks will flag it up.

Managing Your Credit Lines


Applying for loans or credit cards will these days be done on credit ratings and affordability. If you have a poor record on borrowing money (or more importantly, paying it back) you will score badly. Many millionaire poker pros have fallen foul of the banks for missing loan and credit card payments – even if they have £10 million squirreled away. Credit ratings are based on your ability to pay off money borrowed.

Check out credit rating agencies like Experian and Equifax (who have a 30-day free trial) – you can usually just do a one-off credit check to see how you fare BEFORE you visit your bank manager.

Also, the amount of money you have access to can be a factor. If you have £500 on a credit card, say, but your limit is £10,000 you technically have the “potential” to borrow another £9,500. This looks bad on applications so just reduce your credit limit prior to filling out the forms.

And one more no-no for gamblers trying to get credit or a mortgage – never, ever, use payday loan companies. Some mortgage lenders will bar anyone who has used a short-term loan.

The Problems With Self-Employment


In the old days, being self-employed was no barrier to buying a house. Self-certified loans (known as “liar loans”) allowed self-employed workers to say whatever they wanted in the ‘Total Earnings’ box on the application form.

Since the financial crash, self-certified mortgages have bitten the dust, but it can still be hard for self-employed people to get on the ladder.

If you are gambling full-time, it’s good to have a few years behind you. However, lenders vary wildly and some may only go on the past year’s profits.

As with all self-employed income, you will only be eligible to borrow a multiple of your taxable income. That means biting the bullet and paying tax on your winnings, even though gambling winnings aren’t taxed in the UK.

Making Large Gambling Deposits and Payments


Banks will now go through your accounts and flag up all major transactions over £250. That could be in the form of loan repayments, direct debits, childcare costs, or even gym membership.

If that also includes lots of gambling payments it will set off alarm bells with a lender. Some prospective borrowers have had mortgage applications rejected for making large, regular payments to gambling sites. These show up on bank statements quite clearly, and it doesn’t matter if you hit a big slots jackpot – gambling is seen as unsecure.

In short, you are “paying” for your gambling as an expense with a large chance of getting nothing in return.

One solution is to use e-Wallets when gambling such as Skrill, NETELLER and PayPal. However, regular deposits using a virtual wallet may still get questions. And the last thing anyone wants is to be accused of mortgage fraud.