People on benefits can get interest-free DWP loan to help pay for rent and clothes - see if you're eligible

Kieran Isgin & Annabal Bagdi

2 July 2024 at 3:01 am·2-min read

People claiming benefits can get extra help if they are struggling to pay for essential goods. The Department for Work and Pensions (DWP) offers a Budgeting Loan to help pay for thins including rent and clothing.

The loan is only available to people who have been claiming benefits for the past six months. Only certain benefits qualify for the loan.

People claiming Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance and Pension Credit can qualify. If you moved from Universal Credit to Pension Credit, then the time you spent claiming Pension Credit will count towards the six months requirement.

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You may not be eligible if you are already paying back an existing Budgeting Loan or Crisis Loan, Manchester Evening News reports. A Budgeting Loan will need to be paid back and so it should be seen as a temporary relief.

According to Gov.uk, the lowest you can claim with a Budgeting loan is £100. But you could get as much as £812 if you or your partner claim Child Benefit.

If you are single and do not claim Child Benefit, the maximum you could get would be £348 which rises to £464 if you have a partner. The amount you get will also depend on your ability to pay back the loan and how much you have in your savings.

A key benefit of a Budgeting Loan is that it is interest-free - so you will only pay back the amount you borrowed. Repayments are automatically taken from your benefit.

The rate you pay back is based on your income and what you can afford. The government advises that repayments are made within two years of the loan being given out. See more on Gov.uk here.

A Budgeting Loan can help pay for:

Furniture or household items (for example, washing machines or other ‘white goods’)
Clothes or footwear
Rent in advance
Costs linked to moving house
Maintenance, improvements or security for your home
Travelling costs within the UK
Costs linked to getting a new job
Maternity costs
Funeral costs
Repaying hire purchase loans
Repaying loans taken for the above items

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