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Debt Breathing Room For 2021

breathing-space

Debt Breathing Room For 2021

As we discussed earlier, the government wanted to bring in ‘breathing space’ of 60 days for those struggling to repay their debts. It has been announced today that those in serious debt are to be given 60 days to get advice and sort out their finances.

Plans for a six-week ‘breathing space’ period were originally announced in October 2017, and in last year’s budget Chancellor Philip Hammond unveiled plans to extend this to two months.

How Does This ‘Breathing Space’ Work?

If you are struggling with ‘serious’ debts – which in this case is defined as falling seriously behind on payments or having utilities disconnected within the past year – you will be given two months (60 days) without fees, charges, interest or bailiff action, in which you can try to get back on top of your finances before your debts spiral out of control.

During this time you must engage with professional debt advisers, such as the team here at Debt Assist, so that you can find a long-term solution to your debts.

If you are receiving NHS treatment for mental health issues, you will not need to seek professional debt advice during these 60 days.

Life Saving Scheme

Helen Undy, chief executive of the Money and Mental Health Policy Institute, said: “This scheme could genuinely save lives. Everyone experiencing a mental health crisis should have the opportunity to recover free from escalating debt fees, charges and the threat of bailiffs arriving at their door.

“We are delighted that the Government acted on our call to protect people from being hassled about debts while they’re receiving crisis care, and we look forward to working with ministers to put these plans in place over the coming year.”