Home > Credit Score > Can Gambling Affect Your Credit Scores?

Comments 0 Comments

If Las Vegas or Atlantic City are your ideal travel destinations because you love to gamble, luck is on your side: Gambling does not automatically hurt your credit scores. But before you sit down at the blackjack table or roulette wheel and lose a few hundred bucks, you need to know that even though this choice won’t directly harm your credit, it can still be a risky move.

There are certain gambling behaviors that can land your credit in hot water. You may want to avoid these practices to help you keep your credit scores in good shape.

Gambling Beyond Your Means

Hitting the casino or track can do major damage to your credit scores if you can’t afford to gamble in the first place. By gambling away funds you need to pay bills, rent or credit cards, you could end up missing a payment or even defaulting on a loan. Missed payments and defaulted loans can land on your credit reports and damage your credit scores. In fact, payment history is the biggest influencer of your credit scores, making up 35% of your scores.

If you can’t resist betting (and can afford to do so), you may want to set a budget limit before you begin. That way you know how much you can afford to lose and don’t go down the path that causes you to skip out on your other obligations. (You can see how your financial choices and behaviors are affecting your credit by viewing a free snapshot of your credit reports, updated every 14 days, on Credit.com.)

Using Credit Cards

Perhaps you don’t have easy access to a casino, so you venture online to get the gambling rush. Most of these online gambling sites accept credit cards as a form of payment and with a few clicks, you’re given more gambling credits. This makes it very easy to rack up charges on your credit card as you chase an online jackpot.

This practice could be disastrous to your credit scores. The more you charge, the higher your credit utilization ratio. Most credit experts generally advise keeping a credit card balance no higher than 30% of your combined credit limits, ideally 10%, to have the best effect on your scores.

And, if you find yourself applying for multiple credit cards to fund a gambling habit, you could be damaging your credit score by putting too many hard inquiries on your credit report.

Taking a Cash Advance

Cash advances are another risky way to finance your gambling. Cash advances usually involve paying a fee and a higher interest rate (which generally starts accumulating right away) to get cash, putting the balance on your credit card. This is an expensive price to pay for cash, and it also raises your credit utilization ratio.

Casino Credit

Although not extremely common, or available in every state with legalized casinos, some places offer markers, also known as casino credit. You can use these markers in place of cash so you can avoid carrying large amounts of cash, which you can later redeem if you win more than you put down. In some cases, you have to initiate payment, while in others, the casino will draw the funds from your account. It’s akin to writing a post-dated check. No interest is charged.

This is risky if you don’t pay or you don’t have enough cash in your account to cover the withdrawal. In this case, the casino can possibly pursue your funds through debt collectors or court, which could do significant damage to your credit scores. Also, some casinos may initiate a hard inquiry that can appear on your credit reports when you apply for casino credit, which — as we mentioned earlier — will have an effect on your credit scores.

If you have to worry about the effects of gambling on your credit reports, it may be better to avoid gambling. But if you do gamble, you might reduce the risk to your credit by sticking to a budget and avoiding risky funding options. Of course, gambling addiction is a very serious condition that has ruined lives. If your gambling is negatively affecting your life, you may want to seek help or treatment.

Image: mediaphotos

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other sponsored content on Credit.com are Partners with Credit.com. Credit.com receives compensation if our users apply for and ultimately sign up for any financial products or cards offered.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.



Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team