How to Explain Gambling Winnings on a Mortgage Application

How to Explain Gambling Winnings on a Mortgage Application
••• Thinkstock/Comstock/Getty Images

Especially after the housing crash in the mid-2000s, mortgage lenders are careful when confirming whether potential customers are able to make their house payments. This means that, as a mortgage applicant, you are responsible for proving all income or assets that will be relevant to the process. This is easy in cases such as salary or investment income, but more difficult in cases such as gambling winnings.

Obtain and keep the proper paperwork whenever you cash out your winnings. This will help you prove the income, and it is required under tax law for large windfalls.

Include your gambling winnings whenever your file your tax returns. Once it's on a tax return, your mortgage lender cares less about the source of your income, and more about the amount of your income each year.

Report your gambling winnings on your mortgage application form in the section titled "other income" or "assets." The winnings are more appropriate for "other income" if they come in regular payments over time. A single windfall should be listed under "assets."


  • Maintain realistic expectations. Lenders want to know about your reliable, recurring income when determining whether you can afford a loan. Gambling winnings are by nature unreliable, and they don't often turn a lending application in your favor. You may be better served by using your gambling winnings to make a larger down payment, thus reducing the size of the mortgage and making qualification that much easier.