April 25, 2013 | Benefits Loan | 44 Comments Keeping Hush? We find it interesting that the DWP have not widely publicised the existence of additional help that people making new claims may be entitled to. Before the recent welfare reforms came into effect on 1/4/13 that saw the end of Crisis Loans, customers who were waiting for a new claim to benefits to be processed and paid could apply to the Social fund for a payment to ease the wait. The payments were called Alignments to benefit, and were used to forward a small loan against the benefit that may be due in the coming months. You would think that a search of the GOV.UK site would bring a little more information? ……wrong Not one result for the search “Aenefit Advance” Help is STILL available As of 1/4/2013, Alignments to Benefit have been replaced by Short Term Benefit Advances (STBA?s) and can be applied for whilst waiting for a claim to be processed, however a search of the GOV.UK site bring up virtually no information on the availability of these loans, how to apply, who may qualify and how much you may be able to get. Whilst the Government website offers little help, it is possible to find clues in the recently issued legislation that help to decode the mystery. What is a Short Term Benefit Advance? It is an advance of ?benefit ( including Jobseekers and Employment and Support allowance, income support and pension credit) that can be awarded to a new customer who notifies the DWP that they have a financial need which may result in a serious risk of damage to the health and/or safety of them or their family. Who is eligible for a STBA?? Although the Loan is discretionary, specific factors are looked at when deciding on eligibility. You may be able to be awarded a Loan when:? ? It is the start of a new claim, or when a new award of benefit is past due. ? When declaring a change in your circumstances that will drastically increase an award, this can be done at the point of declaration, or after the declaration. ? When the first payment of benefit is not a full two weeks worth. To make an application for a STBA ?Loan, you have to:?? ? Have recently made a new claim ? or have an existing claim to any of the following benefits – Jobseeker?s Allowance, Employment Support Allowance, Income Support, Incapacity Benefit, Pension Credit, State Pension or Carers Allowance. ? Be likely to receive enough benefit for the STBA loan to be recovered from ? Be able to repay the loan from your benefits within 12 weeks ( this can be extended to 24 weeks, however this is in exceptional situations) ? Be able to show that if a loan is not made, that you or your family at serious risk or danger. ? Not be able to find alternative funding anywhere else. Note that you must have a reasonable chance of receiving beneift and may have to show that you pass the habitual residence test (HRT) before and STBA is awarded How much can the Loan be?? In general, as loans are made against benefits they are lower than your likely award to the benefit that you have applied for that would cover the same period. It seems that you can be awarded either 60% of your benefit or 100%, however despite our searches we can not find any information on how these are calculated. We presume that they are set at 60% so that you can afford to repay them and are not put into additional hardship through a reduced income. How to apply for a Loan.. Unfortunately there is no form ( that we can find) for this, it seems that you have to call the DWP and declare that you have a financial need – and then, assuming that you meet the above eligibility criteria, you SHOULD be offered a Short Term Benefit Advance and details taken at that stage. Information on how this is supposed to work is sparse, so please feel free to share your experiences below so that we can build up a detailed picture of how this is working in practice.