Does Gambling Affect a Mortgage Application in the UK?

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Written on 20 June 2022 by Nick Mendes

When you're considering applying for a mortgage, you might be surprised to find out that gambling habits could be part of the assessment. If you're a frequent gambler, the lender may be keen to assess the level of risk they would face in offering you a mortgage. This risk boils down to how often you gamble and how much you're spending on betting as a proportion of your monthly budget.

It's still possible to find a mortgage if you're a recreational or professional gambler. In this article, we’ll consider how gambling might affect a mortgage application, when gambling might be considered excessive and what the best approach might be if you earn income from gambling.

How Can Gambling Affect a Mortgage Application in the UK?

As a standard part of the mortgage application process, your mortgage adviser will conduct an affordability assessment of your finances. This is to evaluate your commitments and whether you can cover the projected monthly payments. Mortgage advisers and lenders need to assess your income and your outgoings and will likely conduct a credit check with a reference agency to see if you have any bad credit or missed payments.

For income, they’ll want to see proof of your employment and salary, as well as any other income you may have – such as dividends from investments or rent. This could also include income from gambling. For outgoings, the adviser will want to examine your full list of expenses including rent, utilities, household expenses, and car finance. The credit check will be conducted through an agency like Experian, so it makes sense to check your credit score for an overall idea of your credit record before you make a mortgage application.

If you have a history of gambling, you may find that it can have a significant impact on your mortgage application. However this does vary from lender to lender. Many lenders generally don’t take a harsh view on occasional gambling for small amounts, whereas others may reject your application outright even if you only gamble from time to time, let alone if you’rea losing large sums of money on bets more regularly and it’s affecting other areas of your life – e.g. your bills or mortgage payments. Fortunately, we know which lenders tend to be more amenable and can help make sure you get the best chance of securing a mortgage.

Lenders will want to know:

How often you’re gambling.
How much you spend on gambling.
Your winnings and losses from gambling.
What forms of gambling you pursue.
If you’ve been gambling recently.
If you also have a bad credit rating.

With all this in mind, it's still possible to make a successful mortgage application even if gambling shows up on your bank statements. The key is to engage an expert mortgage adviser who can guide you to the right lenders.

When Is Gambling Viewed Negatively in a Mortgage Application?

Again, lenders vary in their risk appetite when it comes to gambling. If you’re making frequent bets, some lenders will include these as part of the affordability review. They'll place your gambling spend within the context of your overall income and other outgoings.

Some lenders are happy to factor in a gambling budget , if you can show you're in control of your betting and that it's ultimately sustainable. Other mortgage lenders will require additional scrutiny from an underwriter to assess the full risk profile of someone who gambles frequently.

Sustainability is the most important word here. It's critical that you can show your gambling sticks within a set budget, doesn’t affect your ability to cover your other expenses or bills, and doesn’t affect your standard of living. If you can do this, then with expert advice from a specialist broker like John Charcol, you're more likely to find a mortgage lender who will look favourably upon your application.

Does Gambling on a Debit Card Affect a Mortgage Application?

Whether you gamble using your debit card or you take out large sums of money to gamble with, the lender will still want to assess how this money is being used and what it says about your spending habits and financial stability.

How Do Mortgage Providers Define Gambling?

Mortgage providers define gambling as among the following activities in the UK:

Lotteries
Online gambling and betting
Casinos and slot machines, including the online versions
Online betting sites
Using a bookmaker
Playing Bingo
Scratchcards

Mortgage lenders tend to take a common view on these forms of gambling. The smaller and less frequent your gambling is, the less likely it is to jeopardise your application. However, the more frequent your gambling, the larger the impact it may have on your monthly finances. In this case, many lenders may consider your gambling to be a higher-risk activity and it could result in them rejecting your application. Making a judgment call depends on the risk appetite of the lender as well as their views of your case.

What to Do if You’ve Already Been Declined a Mortgage Because of Gambling

Mortgage applications do get declined in cases where there has been a history of gambling, especially when the betting is frequent and has incurred heavy losses, or when the gambling is significantly impacting the monthly budget.

If this has happened to you, here is some guidance on how to make yourself mortgage ready for future applications.

Stop gambling it may be too obvious to state, but if your gambling has become problematic and has led to a declined mortgage application, then you’ll need to stop or at least significantly reduce the frequency and amounts you gamble. If you can reduce your gambling to a sustainable level that no longer affects your other monthly outgoings, you’re on the right path
Clear your debts whether it's credit cards or loans, clearing your debts is also an excellent place to start. This will show that you're taking responsibility for your finances and settling debts will also gradually start to improve your credit rating
Start saving if you make regular payments into a savings account, it will show the lender that you're more in control of your finances and thus lower risk
Improve your credit rating there are lots of things you can do here, such as registering on the electoral roll, reducing the number of accounts you have and paying off the balance on your credit card each month. Making sure all bills are paid promptly can also help with this

There's no need to despair as it’s not impossible to get a mortgage simply because you’ve been declined one previously. There are lenders out there who may be more flexible on the question of gambling. With the expert advice of a mortgage broker like John Charcol, we’ll connect you with the right lender for your situation.

Having said that, it may be necessary to take time out and address the mortgage-readiness tips immediately above. A second rejection on top of the first could have a serious negative effect on your credit rating. If you’ve already been declined a mortgage, you really should absolutely seek professional advice the second time around to insure you give yourself the best chance of succeeding with your application.

Getting a Mortgage if You Are a Professional Gambler

You can get a mortgage if your main source of income is gambling. However, you’ll need to seek professional advice through a broker, as most lenders will consider you to be too high of a risk to meet their criteria and a broker can direct you towards more flexible lenders. The common view will be that income sourced mainly from gambling is unpredictable and you may not be able to reliably meet your monthly obligations.

If you’ve had a good track record in regular income from gambling without significant losses, you're more likely to be viewed as low risk by mortgage lenders who do cater to professional gamblers.

Lenders who cater to professional gamblers tend to use the following assessment criteria for professional gamblers:

Consistent Income if you can show a regular income from betting as your main source of income, lenders will tend to view you more positively
Longevity if you’ve been gambling for many years as your main source of income, lenders will be more disposed to a positive assessment of your mortgage application
Gambling type skilled forms of gambling, such as cards or horse racing are viewed more positively than frequent betting based on random outcomes, such as Scratchcards or a lottery.
Gambling income ratio this ratio measures your usual betting stake against the funds in your current account. For instance, if you frequently place £100 bets but have many thousands in your account, it’s less likely mortgage lenders will be troubled

In addition to these criteria, mortgage lenders will be looking at your earnings from gambling alongside other eligibility factors. These will include the size of your deposit and your credit rating.

Speak to an Expert about Mortgages and Gambling

If you have a history of gambling or if you’ve had a mortgage application rejected before because of gambling,, it’s crucial that you seek professional advice before making moves to find another mortgage provider.

Advice from professionals can point you in the direction of a suitable mortgage lender who has a favourable stance on gambling and a higher risk appetite for applicants with a background in frequent gambling.