Are debts taken into account if I now need to claim benefits?

[Elmotickler]

I recently took out a large loan for home renovation. (Joint loan with dh) I’ve now found out that I’m about to be made redundant from work. We haven’t used the loan money yet and I'm wondering if this amount will be counted as savings if I need to claim benefits or if they somehow take the debt into account? I’m hopeful that it won’t take me too long to find a job so I’m not sure if it is worth repaying the loan ASAP or would this look like I’m trying to hide savings? Any advice would be appreciated.

Hi - Yes, it will be taken into account when you’re assessed for benefits eligibility.

Do you mean that they won’t count it as savings as it’s a debt? Or that they would count as savings as it’s money in the bank? Sorry if I sound a bit thick, I am panicking a bit today.

It would be counted as savings
They won't ask about your debt, just how much money you actually have

It's savings. And even after you spend it, your debt level does not entitle you to further benefits. It's also all UC now. I hope you find a job quickly!

If you are still in the cooling off period, I'd return the money. If your spouse is making over the threshold, you may be entitled to nothing or only some assistance with childcare.

If you have money/ capital over 16k you wont be able to claim Universal credit. It wont affect tax credits unless you are earning interest on it. If you can't claim Uc then you could look at Contributions based ( new style) JSA for 6 months.

Thank you for the replies. It’s outwith the loan cooling off period so if I was to repay it, I would still have the interest to pay so it doesn’t seem worth doing that just yet My redundancy money is decent as I’ve been with the company for 20 years so it would put me over the savings threshold anyway. I guess I’ve just been unlucky with my timing.

If you are made redundant you will be able to claim contributions based benefit, where savings, redundancy money is not taken into account. It is paid for a certain time limit & they will confirm this time period. After that more information is required.
You may only receive £73 a week, but depends on your circumstances
Start applying for jobs

I got made redundant, I received £73 a week
I got a job quickly
Put in the claim, the day after you are made redundant
When you receive your appointment, you will need to take proof of identification, P45, redundancy letter, CV etc

I haven’t been in this position before and it’s pretty daunting. So thank you everyone for your comments and advice.