Need bank loan but will if affect Universal credits?

MissFlossy222

Any savings over £6000 have to be declared.
Your UC award will be reduced by £4.35 for every £250 you have over £6000.

Numberwang_2

From experience 3yrs ago, so possibly changed. Borrowed money for house repairs. kitchen and bathroom.
Sought advice through UC journal beforehand, as borrowed £7500 + savings. Was given 6 months capital disregard for savings above the £6000. So would recommend asking first and getting UC confirmation on your journal.
On the borrowing side, needed less than than £5k but borrowed £7500 to get better rate, over 5 years to keep repayment lower, almost straight away repaid £2000 and when possible have overpaid loan. This was back when loans were in the low 3% area and was able to repay without penalty, so long as don’t repay the whole balance in one payment.

Spoonie_Turtle

UC allows for disregarding loans taken for house repairs.  Could be worth asking but if it's for improvements (even if they'd make living in the property substantially better) then maybe best not to expect they'd disregard it.

However if it goes in and out within one assessment period (or enough goes out to take savings down below £6,000) then it'll be moot anyway.

Soconfused14

Can I ask when I should let UC know about my savings being over £6000. Do I do it near the assessment end date or what?

Spoonie_Turtle

UC is assessed on your circumstances on the last day of the assessment period.  So that day is fine, or a day or two earlier if you'd prefer and nothing's going to change in the meantime.

I can't remember if it's been mentioned already but any income (such as benefit payments) doesn't count as savings until the next assessment period after you got it, and any Cost of Living payments are disregarded indefinitely.

Soconfused14

Just asked universal credit about this and been told I need to let them know the instant my balance goes over £6000.

Soconfused14

OK asked UC to clarify and said as its a loan and has to be paid back, it doesnt affect my savings/bank balance and I have no need to report to them. 
Asked them twice just so Ive got it on record if its ever an issue.

Spoonie_Turtle

Soconfused14 said:

OK asked UC to clarify and said as its a loan and has to be paid back, it doesnt affect my savings/bank balance and I have no need to report to them. 
Asked them twice just so Ive got it on record if its ever an issue.

Unless they're disregarding it because it's specifically for home improvements, unfortunately if they are wrong here you will still end up having to repay any overpayments even though it's their error for telling you the wrong thing.

I would advise you to report it still, explain what it's for then a decision maker will determine whether to disregard it or not.

HillStreetBlues

Soconfused14 said:

OK asked UC to clarify and said as its a loan and has to be paid back, it doesnt affect my savings/bank balance and I have no need to report to them. 
Asked them twice just so Ive got it on record if its ever an issue.

How much over £6k will you be?  and how much UC per month do you get?

calcotti

Soconfused14 said:

OK asked UC to clarify and said as its a loan and has to be paid back, it doesnt affect my savings/bank balance and I have no need to report to them. 
Asked them twice just so Ive got it on record if its ever an issue.

That is definitely incorrect. A loan counts as capital, see DWP own guidance
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1163111/admh1.pdf

H1020 Capital is not defined in the regulations but what is meant by capital can be found in general law. The items listed below cover the kinds of things that would normally be regarded as a person’s capital but is not a definitive list

1. savings from income such as money held in

- cash

- a bank or building society account

- a save as you earn scheme

- Post Office account

2. a lump-sum or one-off payment such as


- compensation for a personal injury


- money which has been borrowed


- one made by an employer to a person who is made redundant and the payment is not earnings 

- one made by the HO to people on the Refugee Resettlement Programme

- one made to recompense people who have incorrectly had to pay care charges in the past

Once taken into account as capital there is then a decision to be made as to whether or not it falls to be disregarded for a period.