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The COVID-19 pandemic has been a difficult time for many of us. We faced unprecedented circumstances which impacted all aspects of our lives. The property market has also suffered, putting some landlords in a difficult financial situation in turn.

The Debt Respite Scheme, otherwise known as Breathing Space, was introduced by the Government on 4th May 2021 in England and Wales to provide support to the hundreds of thousands of people who are struggling with problem debt.

What is breathing space?

The purpose of breathing space is to help with relieving people of the stress of mounting debt. It allows individuals a period of respite where they will not be contacted by their creditors. Individuals will still be expected to continue making repayments but with the reassurance that most enforcement action will be paused and most interest and charges on debt frozen. However, if individuals are also struggling to make repayments, they are advised to speak to their debt advisor to work out a solution.

Breathing space applies to most unsecured debts, including credit cards, personal loans and arrears on utility bills. It can also only be used once every 12 months.

What types of breathing space are there?

There are two categories of breathing space: standard breathing space and mental health crisis breathing space.

Standard breathing space is available to all individuals facing problem debt. It provides a period of up to 60 days without being chased for payment by creditors or having interest added to existing debt.

Mental health crisis breathing space provides extra protection for those receiving mental health crisis treatment. This lasts for the same duration as the individual’s mental health crisis treatment as well as an additional 30 days on top.

How do I apply for breathing space?

Applying for a standard breathing space requires the individual to seek advice from a debt adviser. The debt adviser will consider the application and decide whether the individual is eligible for breathing space or whether there are alternative debt solutions available.

Those looking to enter a mental health crisis breathing space will do so once debt advisors receive evidence that the individual is receiving mental health crisis treatment from an Approved Mental Health Practitioner (AMHP).

How can City Relay help?

No-one should struggle alone. At City Relay, we aim to form a true partnership with our partners, providing them with as much support and information as possible. Our expert team is on hand to help navigate difficult situations together with our partners. Please get in touch with your dedicated Account Manager for assistance or contact our team today.

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