Budgeting Loan

Overview

Budgeting Loans are interest free loans from the Department of Work and Pensions (DWP) Social Fund that are available only to people claiming certain income-related benefits for a minimum of 6 months. You have to pay back a Budgeting Loan.

What can I use it for?

A Budgeting Loan can help pay for:

  • furniture or household items (for example, washing machines or other ‘white goods’)
  • clothes or footwear
  • rent in advance
  • costs linked to moving house
  • maintenance, improvements or security for your home
  • travelling costs within the UK
  • costs linked to getting a new job
  • maternity costs
  • funeral costs
  • repaying hire purchase loans
  • repaying loans taken for the above items

Who is eligible?

To get a Budgeting Loan you must have been getting one or more of these benefits for the past 6 months (26 weeks (breaks of up to 28 days are ignored):

    • Income Support
    • income-based Jobseeker’s Allowance
    • income-related Employment and Support Allowance
    • Pension Credit

If you moved from Universal Credit to Pension Credit, any time spent claiming Universal Credit will count towards the 6 months.

You cannot get a Budgeting Loan if:

    • you are currently claiming Universal Credit - apply for a Budgeting Advance instead
    • you’re involved in industrial action (for example, a strike, walkout or lockout)
    • you owe more than £1,500 in total for Crisis Loans and Budgeting Loans

Savings Limit

You cannot get a full Budgeting Loan if you (or your partner) have more than £1,000 in savings. This amount is £2,000 if you (or your partner) are over 62 year's old.

How much can I get?

There are three rates of Budgeting Loan, depending on whether you are single, a couple without children or a one or two parent family with children. You can get up to the following maximum amounts:

  • £348 if you’re single
  • £464 if you’re part of a couple
  • £812 if you have children

The minimum amount of Budgeting Loan that you can get is £100.

How much you could get depends on whether you:

  • can pay the loan back
  • have savings of more than £1,000 (£2,000 if you or your partner are 63 or over)
  • are paying back an existing Budgeting Loan or Crisis Loan.

Repaying a Budgeting Loan

The repayments will be taken automatically from your benefits and the amount you repay is based on your income , including any benefits you receive and what you can afford.

After you apply for a Budgeting Loan, you will get a letter telling you if you have been offered a loan. The letter explains how much your weekly repayments would be if you accept the loan.

You normally have to repay the loan within 2 years (104 weeks). If you stop getting benefits, you will need to arrange another way to pay it back.

How to apply

You can either apply online or by a paper application:

Contacts

Social Fund

T: 0800 169 0140

Welsh language: 0800 169 0240

NGT text relay (if you cannot hear or speak on the phone): 18001 then 0800 169 0140

Monday to Friday, 8am to 6pm