As long as you have the proper tax forms and bank statements, you can use gambling winnings to make a down payment on a home. Lenders request a copy of the specific W-2 G tax form for your gambling earnings in addition to the other documents you are usually required to provide when you apply for a mortgage including your tax returns (prior two years), W-2s for job (prior two years), pay stubs for job (prior two months) and bank statements (prior two months).
If you can provide the W-2 G tax form(s) for your gambling winnings as well as the bank statement that shows when you deposited those funds into your account -- even if you deposited the money more than two months ago -- then your gambling earnings should be an acceptable source of funds for your down payment. If you cannot provide the proper tax or bank account documents, then the lender is unlikely to permit you to use your winnings for the down payment.
Use our DOWN PAYMENT CALCULATOR to determine how much money you need to put down to buy a home
Please note that lenders are particular about verifying the source of funds for a down payment and it is preferable, but not always required, that the money is “seasoned” in your bank account for at least two months before you apply for a mortgage. If lenders see a large deposit into your bank account, they may want to understand the source of those funds. The lender wants to make sure the money is from a legitimate source and not a loan for your down payment that you are required to repay.
Review Down Payment Requirements
This is why you may want to wait at least two months after you deposit your gambling winnings into your bank account before you submit your mortgage application. That way, lenders do not see an irregular deposit that could cause a hassle or slow down the process.
Down payment guidelines vary by lender and mortgage program, especially if you want to use gambling income. We recommend that you contact multiple lenders in the table below to understand their requirements before you apply for the loan.
"About Form W-2 G, Certain Gambling Winnings." IRS. Internal Revenue Service, January 13 2020. Web.
"B3-4.2-01, Verification of Deposits and Assets." Selling Guide: Fannie Mae Single Family. Fannie Mae, April 25 2017. Web.