Being Chased By Bill and Debt Collectors?
A New “Breathing Space” Scheme Has Been Proposed
One day life is good and things are rolling along then wham, out of the blue you may be made redundant, take ill, and for some reason no longer be able to work.
Your income is reduced or in some instances stopped.
You may not be working, but the monthly bills do not stop coming in. And those bills can be the rent, mortgage, council tax, electricity, gas, water rates, and not to mention any loans, credit cards, or other accounts you may owe.
So you do what you are supposed to do, rally the troups, see what benefits you may be eligible for, review your savings if you have any, and concentrate on the priority bills; your rent/mortgage, food, gas, water, etc.
This leaves you vulnerable to other bills/debts as you simply cannot repay them.
Then the bill and debt collection process starts, being chased for payments.
The phone calls, text messages and emails.
Adding stress to an already stressful situation, you need space to think, time to breath and find a solution.
That time and space is on its way.
Proposed New “Breathing Space”
This hasn’t been the first time that a “breathing space” for those in debt has been proposed, however it appears now that there is a date set for this new period of time to allow those in debt to seek advice and make an informed decision, without debt collectors constantly contacting, has a date.
The scheme is to begin in 2021, and will include all forms of debts, including council tax, and Bailiff action, for a period of 60 days.
Anyone receiving treatment for mental health issues through the NHS, will have their breathing space protections extended the entire time of their treatment.
What this means is that for 60 days anyone in debt will not be contacted by their creditors, even the local councils, Bailiffs will be put on hold during this time, and the debtor can seek out advice, and sort out their financial issues.
Many lending institutions already have a “code” where they will put an account on hold for at least a 30 day period to allow the account holder time to sort matters out.
John Glen, a City Minister stated, “Problem debt can have a devastating impact of people’s lives, putting a huge burden on individuals which can lead to family breakdown, stress and mental health issues.
“No one should be stuck in an endless cycle of debt and facing the ever-looming threat of invasive debt collectors.”
“That’s why I’m introducing this new scheme, giving everyone access to the advice, time and support they need to both get their finances under control and get away from the perpetual stress and worry debt can cause.”
For many borrowers in debt, just a break in the cycle can allow them time to sort out the issues.
Money and Mental Health Policy Institute’s Helen Undy 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.”
Many people with mental health issues face financial issues as well. They need a break from the stress of it all to not just deal with the debt, but also their own personal issues.
The Money Trust Advice’s Joanna Elson, OBE, stated, “Breathing Space will provide a powerful incentive for people to seek debt advice, safe in the knowledge they will be given the time and statutory protections they need to begin to resolve their financial difficulty.”
“The decision to include local authorities and other public sector creditors is particularly welcome – and means this new scheme could well be a game-changer in our efforts to tackle problem debt as a society.”
“We look forward to working with government and other partners to ensure that Breathing Space is implemented successfully, and to continue to contribute to the government’s plans for Statutory Debt Repayment Plans as these are developed further.”