Universal Credit emergency Christmas loan: who is eligible and when it is due?

By Tom Haynes & Alexander Smail

Those who urgently require money over the Christmas period are now able to apply for an emergency Christmas loan from the Department of Work and Pensions (DWP).

The money is available to people claiming Universal Credit who need financial support while they wait for their first benefit payment.

The loan is also available to those who receive Universal Credit but need cash urgently and cannot wait for their next monthly payment.

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As reported by MyLondon, this includes people who has been subject to a sudden change in circumstances, for example those who have just had a baby.

Many Universal Credit claimants are expected to apply for the loan due to recent rising energy and food costs, as well as the end of the temporary Covid-19 uplift.

Those making a claim for Universal Credit face a five-week wait for the money, which can leave some struggling for cash to pay bills.

The advance payment is currently being offered via the Department for Work and Pensions (DWP), which will allow claimants to borrow money then pay it back in instalments.

The loans are interest-free - and the amount claimants can get depends on how much Universal Credit they are entitled to.

The maximum amount claimants can borrow is currently £1,000. Claimants can ask for up to 100 per cent of the amount but can also ask for less.

Borrowed money should be with claimants within three days of making a claim and will have to make the money last five weeks until the UC payment comes through.

The money deducted from your next UC payment can be worked out by dividing the full cost by 24 (e.g. If you borrowed £1,000, £41.67 will come out of your account every month.

Claimants who get a job and stop claiming UC will still have to repay the loan.

Those wishing to make a claim should apply through JobCentre 0800 328 5644. Applications made because of a change in circumstance should be done over the phone.

Applicants will need to explain their reasons for needing the loan - and won't get the payment automatically.

They will also need to be able to prove that they can pay back the cash, and agree a rate at which the loan will be repaid.

Those struggling to repay an advance will be able to pause a repayment for up to three months (one month for a change in circumstances).

Applicants are advised to contact their work coach or ask online for further assistance.


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