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Budgeting Loans
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What is a budgeting loan?
When can I claim?
How much is a budgeting loan?
How to claim
Repaying the loan
What is a Budgeting Loan?
• Money from the Social Fund, which makes discretionary one-off grants and loans intended to meet the needs of the poorest people.
• It is an interest-free loan, which can be paid to help you buy or pay for certain things. These are:
• furniture and household equipment
• clothing and footwear
• rent in advance and/or removal expenses to secure fresh accommodation
• improvement, maintenance and security of the home
• travelling expenses
• expenses associated with seeking or re-entering work
• HP and other debts (for expenses associated with the things in
the list above)
When can I claim?
• If you are currently receiving income-based Jobseeker's Allowance or Income Support or Pension Credits, or payments on account of one of these benefits, and have been receiving it for at least 26 weeks.
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How much is a Budgeting Loan?
The total amount of money in the Social Fund budget is fixed, and a formula has been developed to decide the maximum amount of Budgeting Loan allowable for people in different personal circumstances. The limits may go up or down depending on how much all Social Fund loan customers are applying for throughout the year.
• The limit is first set for a single person
• A couple will get one and a third times this amount
• Someone with one or more children will get two and a third times
this amount
The urgency of your need and any health problems that you or your family may have are NOT taken into account.
The minimum amount is £100
The maximum amount is £1500
You will not be awarded more than you have asked for. You may be awarded less.
Notes
If you have savings of more than £1,000 and are under 60, or have savings of more than £2,000 and are over 60, this will affect the amount of the award.
You cannot owe the Social Fund more than £1500, so if you have received loans in the past which you are still repaying, this may have an impact on what you can receive. If your debt to the fund is already £1500, you can't receive any Budgeting Loan. You may, in some circumstances, still qualify for a Community Care Grant.
It is important to note that the Social Fund, from which Budgeting Loans are made, has a fixed budget. Once the money in the fund has been allocated, no more will be available until the following year. So it is possible that you can qualify for a loan, but still be turned down.
How to claim
You can download a claim form here. (the link will take you to the Jobcentre Plus website)
Alternatively, you can get a claim form, SF500, from your local Jobcentre Plus office.
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Repaying the Loan
• Normally, money will be deducted from the benefits you receive,
to repay your loan.
• Standard repayment rates are 5%, 10% or 12% of weekly Income Support/Jobseeker's
Allowance, less housing costs, depending on your other commitments.
• Loans are repaid consecutively, i.e. any earlier loan is repaid
in full before payment begins on a later loan.
• The standard repayment period is 104 weeks (2 years).
• You may be offered a choice of loan amounts and repayment rates.
• Repayment terms are set by the Jobcentre Plus office. The terms
of repayment can be changed by agreement but there is no right to an Inspector's
review on these matters.
Anyone having difficulty with their repayment rate should contact their Jobcentre Plus office to see if the loan can be rescheduled.