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Can I borrow money while on benefits?

The simple answer is yes, so long as you can demonstrate your ability to meet the repayments on the loan. When you apply for a short-term loan, the lender that you use has a legal and ethical responsibility to do certain checks before deciding whether or not to approve an application from a customer. 

Before applying for a loan while on benefits, there are a few questions you should ask yourself before deciding if a short-term loan is right for you. Are you claiming disability benefits and need a loan? Do you need a guarantor to apply for a short-term loan on benefits? We answer these important questions and more here.

It is essential to make sure that you are eligible for the loan product that you are applying for. The minimum income requirement will differ from lender to lender and will be higher for more significant loan amounts.

If you are looking for loans for people on benefits, there are a variety of options available to you, depending on the types of benefits that you receive. Loans for benefits, such as Disability Living Allowance or loans for people receiving PIP benefits, (Personal Independence Payments), will be considered, as this is a permanent or long-term benefit.

If you receive a short-term or temporary benefit, the lender will likely look at this less favourably, however, if you can show that you can make the repayments a loan may still be an option. If you are looking to borrow an amount of money, loans for benefits may not be suitable.

Can I get a loan on disability benefits?

If you claim a disability benefit, such as PIP, carer’s allowance, and Employment and Support Allowance (ESA), you may be eligible for a loan on disability benefits. These are examples of long-term benefits available in the UK.

You are more likely to be approved for a short-term loan from one of our lenders if your benefits are long-term disability benefits. Not unemployment benefits, as this could only be temporary.

Loans for people on benefits are available from our lenders, however, it is not always guaranteed as more than benefits are considered when a lender makes their decision. If you receive long-term disability benefits, you are still entitled to apply for a short-term loan. You must be treated equally to other customers by lenders, per the law.

How quickly can I get a loan on benefits?

Same-day loans for people on benefits are available with some of our lenders. If you are on benefits and need a loan today, we may be able to help. The lenders that feature on our panel can offer instant decisions for your application, and if you are approved, they will send the money to your account on the same day. So even for loans on benefits, you may still be eligible to receive a small loan exceptionally quickly.

At New Horizons you can apply for loans from £50 up to £5,000 and repay over 3 to 36 months. We do everything we can to make the process as simple as possible.

New Horizons

Are guarantors needed to be approved for a benefits loan?

If you want to apply for a loan and are on benefits, some lenders may require a guarantor; this will depend on the type of benefits you receive and how much you are looking to borrow. When you apply for a loan through New Horizons, our partner will send your application to a panel of direct lenders. These lenders will perform a soft search on your application, which does not have any impact on your credit rating. If you do not have a guarantor, they also work with a range of lenders who offer loans without a guarantor.

Why choose a short-term loan with New Horizons?

We are one of the top lending websites in the UK, and thousands of individuals use our 3-minute form every day to find a loan. Other benefits are:

  • We never charge fees
  • Loans are easily applied for online
  • You can borrow up to £5,000
  • Repay your loan from 3 to 36 months
  • The best rate is ensured
  • You can apply for a loan from our lenders with bad credit
  • Our lenders only ever do a ‘soft-search’
  • Get cash in minutes

If you are struggling with your debts and require assistance, you can speak to the companies below, free of charge.

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