Budgeting Loans and Budgeting Advances

A Budgeting Loan helps you pay for an essential or unexpected expense if you’re on a low income. It can be used for a wide range of things, including:

• furniture or household equipment
• clothing or footwear
• advance rent or removal expenses for a new home
• travelling expenses
• things to help you look for or start work
• improving, maintaining or securing your home
• maternity or funeral expenses.

If you’re expecting your first child or you’re expecting more than one baby and already have children, you might be able to claim a £500 SureStart maternity grant instead. You don’t have to pay this back.

If you are getting certain benefits and have to pay the funeral expenses of a relative or close friend, you might be able to apply for a Funeral Payment.

You can apply for a Budgeting Loan if you’re getting one of these benefits:

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

You must have been claiming for at least 26 weeks, either consecutively or with a break of no more than 28 days.

The minimum amount you can ask for is £100, but there are maximums based on your household circumstances:

• £384 if you’re single
• £464 if you’re part of a couple
• £812 if you have children.

Some things affect the amount of loan you can ask for, like:

• existing Social Fund loans
• savings over £1,000 (or £2,000 if you’re 63 or over).

You can apply online at GOV.UKOpens in a new window. This option isn’t available in Northern Ireland.

You can also download, print and fill in Form SF500 at GOV.UKOpens in a new window

Or ask for the form at your local Jobcentre Plus (or Jobs and Benefits Office in Northern Ireland).

Loan repayments are interest-free and worked out at the time your loan is agreed.

Depending on the amount you borrow, you normally have to pay it back within two years.

Repayments are usually automatically taken out of your benefits.

If you stop getting benefits while you’re paying back the loan, you’ll need to agree another way to pay the money back.

If you have a loan but can no longer afford the agreed repayments, ask the office that paid you to work out another repayment plan. It’s important you don’t get into debt trying to pay off the loan.

If you’re claiming Universal Credit you should claim a Budgeting Advance instead of a Budgeting Loan. This is the equivalent of a Budgeting Loan for people who are claiming Universal Credit.

To get a Budgeting Advance you must:

• Have been getting Universal Credit for at least six months – unless you need the money to help you get a job or keep an existing job.
• Have earned less than £2,600 if you’re single (£3,600 if you’re in a couple) in the past six months.
• Not be paying off another Budgeting Advance.

You will usually have to start paying back your Budgeting Advance out of your next Universal Credit payment and pay it back within 12 months.

Ask your work coach at your local Jobcentre Plus about how to claim a Budgeting Advance.

The minimum amount you can ask for is £100, but there are maximums based on your household circumstances:

• £384 if you’re single
• £464 if you’re part of a couple
• £812 if you have children.

Local authorities in England and the devolved governments in Scotland, Wales and Northern Ireland can provide help and support in an emergency.

• If you live in England, contact your local council to find your local welfare assistance schemeOpens in a new window
• If you live in Scotland, find out about the Scottish Welfare FundOpens in a new window on the Scottish Government website.
• If you live in Wales, find out about the Discretionary Assistance FundOpens in a new window on the Welsh Government website.
• If you live in Northern Ireland, find out about Discretionary SupportOpens in a new window on at nidirect.

You might be able to claim a short-term benefit advance if you need money while you’re waiting for your first payment of these benefits:

• Carer’s Allowance
• Pension Credit
• State Pension
• Employment and Support Allowance
• Jobseeker’s Allowance.

Ask your Jobcentre Plus (Jobs and Benefits Offices in Northern Ireland) about a short-term benefit advance.

If you’re waiting for your first Universal Credit payment, you can ask for a Universal Credit Advance.