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The government’s new “breathing space” scheme for debts could be a blessing for mental health

We are sharing an article by Mr Bankruptcy, first published on 20th May 2021, via James Rosa Associates:


Earlier this month the government introduced a scheme to provide “breathing space” to help those in debt to get on top of their situation. It is hoped this year alone, 700,000 people who are in debt could benefit from the scheme, with more than £400 million in extra debts repayments being made.


Why is breathing space important?

If you are in debt, it can feel as though you’re on an uncontrollable downward spiral. Whilst you’re struggling to pay existing debts, you see interest continuing to mount up and the thought of being contacted by creditors or the threat of a visit from bailiffs exacerbates an already stressful situation.


The idea of “breathing space” could be a lifeline, allowing time to find support and advice to better manage your debt.


How will the scheme work?

For a period of 60 days, people will be given legal protection from their creditors. Most interest and penalty charges will be halted during this period and enforcement actions will also be stopped for the entire 60 days. During this breathing space people will receive advice from a debts advisor to help them put a plan of action in place to tackle debts.

To access the scheme, you must contact a professional debt advisor who can help determine whether this scheme is appropriate for you. Alternatively, an approved mental health professional can certify you are having crisis treatment and a debt advisor can then consider eligibility for the scheme.


Taking mental health into account

In recognition of the impact of debt on mental health, and vice versa, for anyone receiving mental health crisis treatment the protections offered by the breathing space scheme will continue for the duration of their treatment, plus an additional 30 days.


This is not a payment holiday

During lockdown, we’ve seen the idea of payment holidays introduced, but it is important not to see this scheme as another kind of payment holiday. During the breathing space period you will need to continue paying off debts, together with any bills, mortgage payments, taxes etc.


It’s also worth noting that you can only use this scheme once during a 12-month period, unless you are receiving mental health crisis treatment.


If you are overwhelmed by debt this could be just the opportunity to help you escape from a vicious circle of debt and receive the right advice to better manage your situation and begin taking back control of your situation.


James Rosa Associates

James Rosa associates is a firm of debt advisors and debt adjustors. With a supportive and friendly approach, we offer a full range of advice and professional services to individuals and business owners/directors who face unmanageable debt or who are involved in civil or commercial disputes. Our services include:

  • Insolvency support

  • Negotiated settlements

  • Personal assisted bankruptcy

  • Mediation

We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions to fit their specific circumstances.


Find out if you qualify for a free consultation


If you are looking for a way to start dealing with unmanageable debt,


or to bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email enquiries@jamesrosa.co.uk to find out whether you qualify for a free consultation.


Please be advised that all views expressed in these posts are those of the author and not of James Rosa Associates ltd or Hexagon Legal Network.