Residents of Estonia often wonder whether gambling can interfere with obtaining a home loan. An expert from Luminor Bank told how things really are. :format(webp)/nginx/o/2024/01/17/15835051t1he77b.jpg)
Housing loan. Illustrative photo. Photo: Sander Ilvest
Residents of Estonia often wonder whether gambling can interfere with obtaining a home loan. An expert from Luminor Bank told how things really are.
Professional sports are in the spotlight this summer: hundreds of thousands of Estonians will be watching the European Football Championship and the Olympic Games on TV.
Sports betting organizers are also stepping up their advertising and campaigns around these events. Tanel Rebane, head of retail banking at Luminor Baltic, analyzes the impact of sports betting on the possibility of obtaining a loan.
“Sports betting is not an automatic disqualifier for a bank loan, but for a bank it is in the same category as casino gambling, where several aspects are assessed,” says Rebane.
He gave an example that if a person planning to take out a home loan bets only during a month, say during a national team match or a major football tournament every two years, and if the betting amounts do not affect his livelihood, then the bank won't see this as a problem.
“You can make predictions from time to time, but if it becomes a regular activity or indicates signs of gambling, then the bank is likely to view it as a negative. Of course, it all depends on the amount spent on problem gambling and the person’s income. If gambling becomes a significant part of income as well as expenses, then it is definitely a problem,” he said.
Rebane added that being interested in football doesn't mean you should automatically go out and place big bets.
“You can, for example, bet with friends about who will win the tournament and bet a symbolic amount of money. However, when you bet significant amounts of money, and even in a professional environment, it goes beyond the normal excitement of football,” he said.
The head of the retail banking department at Luminor Baltic noted that if a person also spends a significant part of his income, for example, on lotteries, then from the bank’s point of view this is a negative behavior pattern that shows that he is looking for an opportunity to get easy money.
The expert noted that he had heard stories from people according to which a person could live next to a casino, for example, and buy cigarettes there every day or withdraw money from the nearest ATM.
Even if the client does not go to the casino regularly, the bank may have a different impression. According to Rebane, when applying for a loan to purchase a home, the bank will not miss suspicious payments and will ask about them, and in such a situation the applicant will have to give an explanation.
“If a person intends to take out a loan, I would recommend that they think about their financial decisions in advance to understand whether there are any signs of risky behavior in them. Betting on sports, lotteries or even casinos are not automatically disqualifying factors for a home loan, but only if it is within reason,” Rebane said.