If you are thinking about applying for a mortgage or loan soon, you might have suddenly given your credit score a little more though. A late gym payment here and a forgotten telephone bill there may suddenly seem a little more daunting. But what about your gambling sessions? If you like to gamble you will probably want to know how that affects your credit score. The good news is that there is no reason to go and close your Royal Vegas casino account - but the answer is a little more complicated than that. Read on to understand more.
First, What You Need to Know About Your Credit Score
Your credit score is a rating of how you handle and use money. One common mistake people believe is that having a lot of money in the bank or a savings account automatically leads to a high credit rating. The truth is that your savings and your credit score are not related. The score is determined by managing the ingoing and outgoings of your finances efficiently and correctly.
For example, it is better to have a debt that you pay off within the agreed timeframe and on time than it is to have no debts at all. This is because it shows banks that you know how to budget and manage finances in line with frequent payments. This is how people achieve the perfect credit score.
It is your credit score that allows you to secure loans and mortgages. Without a good score you can be shut out of financial capital for the family home, new car, holiday abroad or a business venture.
No Gambling Link, No Problem?
If you enjoy some fun gambling sessions and are now worried about your credit score, breathe a sigh of relief because there is no direct link between gambling and your credit score. However, the truth of the matter isn't that black and white. Gambling may affect your credit score if your gambling has gotten out of control. It depends on how you fund your gambling. For example, do you make large and frequent deposits with a source that is dependent upon your credit score such as a credit card? If you answered yes to this question, there is some risk of damage to your credit score.
How to Avoid Gambling from affecting Your Credit Score?
The bottom line is that you can make sure gambling does not affect your credit score by only gambling what you can afford to pay back on your credit card. If you are deferring credit card repayments because of losing money to the casinos, then you are harming your credit score. Know your limits to maintain your credit score and still get the acceptance letter for that mortgage. For more information, it is best to speak with financial experts.