Budgeting Loans 2019

What is a Budgeting Loan?

Budgeting Loans can be available from the Social Fund to help you pay for necessary things while you are on benefits. It is normally available and administered in conjunction with Jobcentre Plus departments.

These types of loan advances are free of interest so you only pay back the amount borrowed. You would get 104 weeks (2 years) to make the repayments (but paid on a regular basis).

UK Budgeting Loans are not welfare benefits or allowances ‘per se’. They are helpful loans which have to be paid back on a regular basis out of your benefits payments.

So, if you are receiving an advance and come off benefits, you will still have to keep to the agreement to pay back the loan.

Put another way:

Budgeting Loans are available for people who have been receiving ‘income-related-benefits’ for a minimum of 26 week (6 months). You need to still be receiving those types of benefits when you apply for the loan.

The crisis loan could be available to help pay for essential things if you are on low income, or claiming certain welfare benefits. The minimum amount you can borrow is £100. The maximum amount depends upon your particular circumstances set out below.

The loans can be used for a number of different reasons, such as rent payments, furniture items, clothes, or even for paying off hire purchase debts.

How Much Can I Borrow?

You can borrow between £100 and £348 if you’re single and between £100 and £464 if you’re part of a couple (e.g. you have a partner). If you have children, you can borrow up to £812.

The maximum amount you can borrow is £1,500 in total. For instance, it may be possible to have an additional Budgeting Loan after the first one. But, you will not be allowed to exceed the maximum total from the Social Fund Loan.

Eligibility for Budgeting Loans

How much Budgeting Loan you can get will depend on:

  1. Can you pay back the loan from your total benefits (your income). If your monthly repayments exceed your income of benefits or whatever, you will not be considered.
  2. If you have any type of savings of over £1,000. The limit increases to £2,000 if you or your partner are over the age of 63.
  3. Whether you already owe money to the Social Fund (e.g. you have an existing Budgeting Loan or Crisis Loan).

How is a Budget Advance Loan Paid?

It is normally paid into your bank or building society account. The account where you normal benefits are paid is suitable. If you have any uncertainty you can call the Budgeting Loan contact number set out below.

Who Can Get a Budgeting Loan?

You can get this type of emergency advance payment if you have been getting one of these qualifying benefits for at least 26 week (6 months):

Who Cannot Get a Budgeting Loan?

  • You will not be eligible if you are out on strike – or involved in other forms of industrial action.
  • If you already owe more than £1,500 in crisis loans and budget loans combined.
Note: You should apply for a Budgeting Advance instead if you are claiming Universal Credit.

What Can You Use Budgeting Loans For?

You can use a budget loan for more or less anything you need for day to day living or emergencies, such as:

  • Your normal rent or rent arrears.
  • Things for the house including furniture and other equipment.
  • Clothes or any type or shoes and other footwear.
  • Moving expenses (if and when you move home)
  • Travel expenses such as a season ticket or other tickets and fares.
  • Anything you might need to help you find a job.
  • Home improvements or making your home safe and secure for yourself or your family.
  • Maternity expenses.
  • Funeral expenses.
  • Debts or hire purchase for any of the expenditures listed above!

How to Claim Budgeting Loans

Address for Budgeting Loan form

There is no postal address for the Budgeting Loan form to be obtained. It is normally available as an online facility. You can fill in the form online, but then you will have to download and print it.

Note: You can also get a loan application form from your local Jobcentre Plus office.

Claim for Budgeting Loan online

Download and fill in a Budgeting Claim form SF500. You will need to print off the claim form and complete it in ink. If you prefer, the form can be obtained from your local Jobcentre Plus branch.

How long does it take to get Budgeting Loans?

Your claim can take up to 15 working days to process after you have posted it and for it to be paid into your bank. Including your mobile phone number means you will be able to get updates on your loan payment progress.

If you have sent your application form by post, you should allow at least 19 working days before following it up with any queries.

Related Guide: The UK Rules website (or GOV.UK) has further advice and a lot more helpful information about the Budgeting Loan process and how long it takes.