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Budgeting loans are repayable, interest free loans for essential items. You do not have to pay National Insurance contributions to qualify.
What are Budgeting Loans?Budgeting loans are payments intended to meet important expenses for which it may be difficult to budget.
Loans are budget limited and decisions will be made following a set of fact based criteria. When an application is made the purpose of the fund will be to meet the expenses required under a list of categories. These categories are :
- Furniture and household equipment
- Clothing and footwear
- Rent in advance and/or removal expenses to secure new accommodation
- Improvement, maintenance and security of the home
- Travelling expenses
- Expenses associated with seeking or re-entering work
- Hire-Purchase and other debt (For expenses associated with the above points)
All these categories carry equal priority and applications for items falling outside these categories would be refused as the purpose of the fund would not have been met.
You are eligible if you:
- have been in receipt or have been the partner of someone in receipt of Pension Credit, Income Support or income based Jobseeker's Allowance for the preceding 26 weeks, including any number of breaks each up to 28 days.
You will not be eligible if you or your partner are disqualified from receiving Jobseeker's Allowance because of a trade dispute.
Every application will have a Maximum Credit Range, this is the maximum amount available to each person, and is where the factual criteria and the budget are combined.
Once the Maximum Credit Range is established, the access of the person to that amount is dependant on their current budgeting loan debt at the time of the application.
If the person has a current budgeting loan debt, the total of the proposed budgeting loan debt and current budgeting loan debt must not exceed the Maximum Credit Range.
You should complete form SF500 available from your local Social Security or Jobs & Benefits office.
The minimum loan is £100. The maximum is £1500 less any outstanding Social Fund debt you or your partner have.
Any award is reduced by capital over £1000 (£2000 if aged 60 or over).
The loan must not exceed the amount you are likely to be able to repay.
Repayments are flexible taking into account income and commitments and are usually made over a period not exceeding 104 weeks.
There is a review system.
Further details can be found in:
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