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Financial emergencies happen for all sorts of reasons, and many of us are just one bad month away from financial difficulty, especially if you’re already on low income or receiving benefits. That’s where the Government may be able to help you.
In this guide we’ll explore the government crisis loan and other forms of financial help the Government provide to low income who are encountering money trouble.
Government crisis loans were a type of loan the UK offered up until recently, created to help people experiencing a financial emergency and in need of a short-term cash injection to help them pay for essentials.
Unfortunately, the Government is no longer offering crisis loans, however they are offering an alternative to a crisis loan – social fund budgeting loans.
If you have been on certain benefits for an extended period of time (usually a period of at least 26 weeks) you may qualify for financial support in the form of a social fund budgeting loan.
These loans are designed to covered sudden, unexpected costs that your benefit payment may not cover, whether that’s an emergency health procedure or a problem with your washing machine. Budgeting loans typically cover the cost of things like:
The amount you receive depends on the circumstances causing you to apply for the loan, but the minimum amount you can apply to borrow is £100.
If you are successful in your application, you will receive the interest free loan upfront, and repayment of the loan will be deducted from your benefits over time, starting with your next benefit payment.
Why choose IVA Plan?
The first step to applying for a budgeting loan online is to check your availability. You can do so by visiting the Government website, here, and comparing your circumstances to the eligibility checklist.
If you qualify, you can apply for a budgeting loan here. Simply fill out the easy-to-follow questionnaire. When you apply online, you can decide how you would like to be informed whether you’re application has been successful: by email, text message, or letter.
If you’re not comfortable applying for a budgeting loan online, you can apply via a paper form, by either:
If you have any questions about the process, or are having problems with your application, you can call the Social Fund Enquiry Line on 0800 169 0140.
If you don’t qualify for a social fund budgeting loan to help you through a financial emergency, there are other forms of Government support available.
Hardship payments are available to low income who have had their benefits stopped or are otherwise struggling to pay for their living costs. To qualify, you need to be receiving one of three benefits:
If you receive one of these benefits, or you look after an at-risk individual who is struggling top pay for essentials like utilities or food, you should get in touch with your local Job Centre Plus about a hardship payment.
Alternatively, you can contact the Department for Work & Pensions (DWP) on 0345 608 8545 to get more information.
A Personal Independence Payment (PIP) is aimed at people with long term physical or mental disabilities, where that disability causes the individual to struggle financially.
You will be assessed by a health professional before receiving support, and the level of financial support you will receive will depend on your personal and financial circumstances.
You can make a PIP claim by contacting the DWP on 0800 917 2222.
housing costs housing benefit
A short term benefit advancement is jsut what it sounds like – an advance of your regular benefits. It is helpful for people in a financial emergency who need cash in a hurry.
The benefits will be given to you upfront, and you will repay the advance by having a portion of your regular benefit payment deducted over a period of 12 weeks.
To qualify, you need to be in one of the following positions:
You can apply for a benefit advance by contacting the DWP office who deals with your regular benefits – just check the mail your receive from them and you’ll find the number you need.
Absolutely fantastic team, which helped throughout the whole process and kept me updated through every step, highly recommend. Can’t believe how much better I feel the worry has been lifted."
Karen
A lot of the Government support available to people in emergencies is targeted at those already receiving certain benefits. If you’re not claiming benefits already and are in financial difficulty, you may qualify for one of the following.
A benefit available to low income or unemployed people who are aged 18 and over (or 16 and 17 in certain circumstances) that you’ll receive in the form of a monthly payment.
You can find out more about universal credit on the Government website, here.
A benefit paid to people who are either not working at all or are only working part-time, as long as they are actively seeking full-time employment.
Read more about Jobseekers Allowance here.
A benefit for people who suffer from a disability or other health condition that impacts how – and how often – that person can work to support themselves.
To find out if you qualify for income-related employment and support payments, read more here.
Nobody should have to worry about how they are going to put food on the table if they’re hit with an unexpected cost, but for too many low income people that’s a sad reality.
IVA Plan can help. Our team of experienced debt professionals have coached thousands of people through some of the worst financial situations, and helped them come through the other side.
If you’re struggling with your finances and facing mounting debts, talk to IVA Plan today and we can help you map your route out of problem debt.
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