What is a Budgeting Loan?
You could receive a Budgeting Loan to help pay for essential things such as furniture, clothes, the cost of moving or debts to hire purchase companies. The loans are interest free and the smallest amount that you can borrow is £100. As a general rule, you’ll have to repay the loan within 104 weeks. The repayments are taken from your benefits, and if you stop getting benefits, you’ll have to pay the loan back in another way.
How much you can get
You can get up to:
- £348 if you are single.
- £464 if you are part of a couple.
- £812 if you have children.
The amount that you can get depends on factors such as your ability to pay the loan back or whether you have any savings over £1000 or (£2,000 if you are over 62). You also cannot be in any debt to the social fund over £1,500 whether that be through crisis or budgeting loans.
Loans are usually paid into your bank or building society account.
How to find out if you are eligible
In order to qualify for a budgeting loan, either you or your partner must have been receiving one or more of the following benefits for at least 26 weeks:
- Income support.
- Income based Jobseeker’s Allowance
- Income related Employment and Support Allowance
- Pension credit
If you receive Universal Credit, you can apply for a budgeting advance from your local Job Centre Plus instead. This is an advance payment of universal credit which is treated in the same manner as a loan.
What you can use a budgeting loan for:
- Furniture/household equipment
- Advance rent when you find a new place to live
- Removal expenses when you move house
- Things to help you look for/start work.
- Travelling expenses
- Improving, maintaining or securing your home.
- Funeral or maternity expenses
- Repaying hire purchase debts.
How to claim:
You can claim by downloading form SF500 from the Government website. Your claim can take up to 15 days to process.