A sudden or unexpected bill is enough to throw anyone's finances into chaos - and often accounts for why many people turn to rip-off payday lenders or illegal loan sharks for money in desperation.
However, if you're on a low income and receive certain benefits, you may be able to claim an advance payment on Universal Credit or a Budgeting Loan to tide you over until payday.
This is a type of loan offered by the Government and can help you pay for household items, clothes, rent in advance, maintenance, improvements or security for your home, travel, funeral costs and even loans taken out for any of the above.
You’re only eligible for a Budgeting Loan if you've been on certain benefits for six months - such as Income Support, income-based Jobseeker's Allowance, income-related Employment and Support Allowance and Pension Credit.
If you've been switched onto Universal Credit from Pension Credit, any time spent claiming for it will count towards the six months.
However, you cannot get a Budgeting Loan if you are currently claiming Universal Credit ( that's where advance payments come in ), you’re involved in a strike or you already owe more than £1,500 in total for Crisis Loans and Budgeting Loans.
How much you could get
The lowest amount you can borrow is £100. However, this rises to £348 if you’re single, £464 if you have a partner and £812 if you or your partner claims Child Benefit.
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) or are paying back an existing Budgeting Loan or Crisis Loan.
How does it work?
A Budgeting Loan is interest free so you only pay back what you borrow.
The repayments will be taken automatically from your benefits. The amounts you repay are based on how much benefit you get and what you can afford.
You normally have to repay the loan within 2 years (104 weeks).
How to apply for help
If you match the above criteria, you can apply online or by post. You must use the paper form if you’re applying on behalf of someone else.
Alternatively, find out how you can apply online, here .
After you apply, you’ll get a letter telling you if you've been offered a loan within 25 days - if accepted, you'll have to sign and return an agreement letter. Your money will then be deposited into your bank, building society or credit union account within 12 days.
