Life can get expensive sometimes. As well as regular spending on essentials like food, phone, gas and electricity, plus clothes, transportation and things like a TV license there are events like birthdays, Christmas and a holiday to pay for.
Getting by week to week can be a huge challenge, especially if something unexpected happens like the washer breaking down, or the kids needing a new school uniform and shoes. It can be even harder when you are depending on benefits to get by.
Taking out a loan is one way to help when you need some extra cash, fast, but it’s not always easy to actually secure one. This is especially true if you are on benefits, as there may seem to be few options open for borrowing money when you don’t have a decent monthly income. But that isn’t always the case. There are some reputable companies who offer benefit loans, and here we look at five advantages of taking up this kind of opportunity.
Advantage 1 – You can avoid payday loans
It’s a sad fact that too often those who have low incomes struggle to find loans at a halfway decent rate, so fall into the trap of borrowing from doorstep lenders, (who are basically loan sharks), or from payday loan companies which require large repayments over a short term term, and generally charge sky-high interest on top.
Advantage 2 – Borrowers can enjoy a more realistic and flexible repayment plan
Benefit loans can be agreed over a longer period of time, which in turn reduces the monthly repayment to a figure which is more realistic. This could well help the borrower falling deeper into a debt spiral where more and more is borrowed simply to maintain the repayments.
Advantage 3 – The loan can help replace essentials
Few people can function properly without things like white goods, and using a benefit loan to replace a fridge, cooker or washing machine mean they will probably have paid the loan off long before the equipment breaks down and needs to be replaced again.
Advantage 4 – A benefit loan can help when transitioning into work
Many unemployed people worry about taking a job because they have not got suitable clothes for a work environment, or perhaps no tools or other essential equipment. Transportation to and from work can be tricky too in that initial period before payday, so a benefit loan in those situations is a great option.
Advantage 5 – They can help you enjoy special events
It’s easy to say that people on low incomes should just forget things like Christmas, birthdays, mention proms, which are fast becoming part of both primary and secondary school culture? Never mind wanting to do something simple like take the kids to a caravan for a few days in the holiday.
A decent lender will assess your application based on all the regular income you have, so if some or all are from regular benefit payments, including disability living allowance, working and family tax credit, as well as regular unemployment allowance, you will not be disadvantaged based on where the cash is coming from.