A universal credit budgeting advance is an interest-free loan designed to help universal credit claimants pay for one-off or unforeseen expenses. Learn about how much you can borrow, and compare your other options with our guide.
If you’re on universal credit or other benefits and need to cover a large upcoming expense, you can choose to receive some of your benefit upfront as a loan. The loan is then repaid over the next 12 months through your regular universal credit payments, which means you’ll receive a lower monthly payment until the loan amount has been paid off.
The minimum amount you can claim on a budgeting advance loan is £100. The maximum amount depends on your personal circumstances and how much money you have in savings.
However, if you have more than £1,000 in savings, the amount you can borrow will be the figure above, less whatever savings you have above £1,000. For example, if you’re a single person without any dependent children and you have £1,100 in savings, the maximum you can borrow is reduced to £248 (£348 minus £100).
When you apply for a universal credit budgeting advance, you should receive a decision on the same day. The budgeting advance should then be paid into your bank account within 3 days but can be transferred on the same day in the case of an emergency.
You can apply for a universal credit budgeting advance online, by contacting your local Jobcentre Plus work coach or by calling one of the universal credit helplines below. You’ll need to prove you have a valid need for the loan and can pay it back.
Universal Credit helpline
Call centres are open Monday to Friday from 8am to 6pm.
The loan isn’t only available for universal credit claimants. You may be eligible for the loan if you’ve claimed any of the following benefits in the last 6 months:
You must have earned less than £2,600 in the past 6 months (or £3,600 if you’re part of a couple) to be eligible for a loan.
However, you’ll likely be refused a budgeting advance if it appears that you may be unable to pay it back.
If you’ve claimed a budgeting advance in the past, you must have paid it back before you can claim another one.
If you’re struggling to meet essential expenses like rent or food while waiting for your first UC payment, you can ask for a universal credit advance instead. This is a different interest-free loan, although it’s also paid back via deductions from future UC payments.
A universal credit budgeting advance will only be approved if it’s being used for essential one-off expenses or charges, such as:
You’ll be asked what you’re planning to spend the money on. If you’re trying to claim a budgeting advance for ongoing costs (like food, travel or childcare) or one-off luxury purchases (like a new TV or event tickets), your claim will be denied.
Repayments are automatically deducted from future universal credit payments. These deductions are usually spread across your next 12 universal credit payments, and you can request that your payments not start for 3 months in exceptional circumstances.
If you no longer receive universal credit, you’ll still need to pay off the budgeting advance loan amount.
If you’re struggling to afford rent, you could explore whether you’re eligible for a discretionary housing payment. This is another benefit available to those claiming housing benefits.
Benefit claimants are likely to have limited options when it comes to claiming loans. You may be eligible for a credit-builder credit card or a payday loan, but these have higher interest rates attached to them and could cause more problems than they solve. A payday loan should be your last resort for borrowing money. Only apply if you can afford to make the repayments on time.
If you’re in extreme financial hardship, you may be eligible for financial assistance from your local council.
If you’re really struggling for ideas to cover an unexpected expense, consider seeking debt advice from an independent body, such as the MoneyHelper.
A universal credit budgeting advance is a useful option that could get universal credit claimants out of a sticky financial situation. Although the loan is interest-free, it will reduce your benefits for the next 12 months, so it should only be claimed if you can get by with a reduced benefit payment.
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Would I be able to get a budgeting loan for deposit on a new house as I’m currently joint tenant with my friend and needing to move back to my home town an no means of paying a deposit on new house
Hi Sarah,
Thank you for reaching out to Finder.
The loan isn’t only available for universal credit claimants. You may be eligible for the loan if you’ve claimed any of the following benefits in the last six months:
universal credit
jobseeker’s allowance (income-based)
employment and support allowance (income-related)
income support
pension credit
You must have earned less than £2,600 in the past six months (or £3,600 if you’re part of a couple) in order to be eligible for a loan. You can apply for a budgeting advance through your local Jobcentre Plus, either by phone, online or in-branch.
Hope this helps!
Cheers,
Reggie
Hi can anyone shed some light on the things we are entitled to but the dole don’t tell us I ask for things and my work coach rather don’t want to enquier about it or doesn’t want to actknoledge I’m entitled to things thank you I mean things such as clothing vouchers ex as I am no fixed aboad
Hi Danny,
Thank you for reaching out to Finder.
For benefits that citizens may be entitled to, you may need to reach out to your local government as well as visiting http://WWW.GOV.UK to learn more about the benefits that you are entitled to if you met the eligibility requirements. Hope this helps!
Cheers,
Reggie
Hi Kirsty,
Thanks for your inquiry.
Yes. To apply for a Universal Credit advance you can:
– speak to your Jobcentre Plus work coach
– apply through your online account
– call the Universal Credit helpline
I hope this information helped.
Kind regards,
Bella
Would I be able to get an emergency budgeting advance for a new fridge and cooker? Only the oven and my cooler work now and I haven’t had a fridge for several months as a can’t afford them.
Hi Tracey,
Thanks for getting in touch with Finder. I’m sorry to hear about your situation.
The answer to your question would depend on your eligibility. If you meet the eligibility requirements of getting a universal budget advance, then you can apply for a loan. To be eligible, you need to have earned less than £2,600 in the past six months. You also need to show that you’re able to make repayments. You can know more about the eligibility requirements of universal budgeting advance by reading the details written under the subheading, “Do I qualify for a universal credit budgeting advance?”
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
I have been trying to apply for a loan but as I have no credit at all I have been refused all the time. I am in desperate need of a new bed for my 4-year-old and new fridge. Do you have a solution to help with funds today?
Hi Melisa,
Thanks for getting in touch with Finder. I’m sorry to hear about your situation.
Just to confirm, are you trying to get a universal credit budgeting advance? If yes, please check their eligibility requirements. If you believe you are eligible, then please get in touch with them to start your loan application.
Alternatively, you might consider getting a loan with a guarantor. Please go to this link to know more about your option. On that page, you will see a table that allows you to conveniently compare guarantor loans based on total payable, month, monthly repayment, and APR. Once you found the right one for you, click on the “Go to site” green button to learn more or initiate your application.
Other options may also include asking your friends and relatives. Check if they can lend you money.
Finally, if you need more help in knowing how to handle your finances, please go to this page. It is the website of Money Advice Service.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua