Breathing Space Scheme to help with debts
Breathing space is a new Government scheme that could help if you’re struggling with debt, including rent arrears.
The scheme freezes payment demands and legal action by creditors (including GCH as a landlord) while you get free quality debt advice.
Breathing space can be used to stop or delay eviction for rent arrears despite this always being our last option.
If you are concerned or worried about paying your rent, please contact our friendly Tenancy Sustainment Team as soon as possible. They can work with you to identify if there is any early intervention that can help your arrears and budgeting.
Types of breathing space
There are 2 types of breathing space:
- Standard 60 day breathing space.
- Mental health crisis breathing space
Who can get breathing space?
You could qualify if you’re unable to meet any of the following debt repayments:
- Rent or mortgage arrears.
- Payday loans.
- Council Tax arrears.
- Benefit overpayments.
- Gas and electricity arrears.
- Store cards and credit cards.
- Personal loans and overdrafts.
A debt adviser will tell you if it’s a good option and can put you on the scheme.
To qualify for the mental health crisis breathing space, a mental health professional must confirm you’re receiving crisis treatment.
Who cannot get breathing space?
If you’ve already had a standard breathing space in the last year, you can’t get another one.
You can’t get either type of breathing space if you have any of these in place:
- Debt relief order (DRO).
- Individual voluntary arrangement (IVA).
- Bankruptcy order
How to apply for breathing space
Only a regulated debt adviser can put you on the breathing space scheme.
You’ll need to:
- Provide details of your income, spending and debts.
- Be prepared to work with a debt adviser on a longer term debt solution.
You can get free regulated debt advice from the following charities:
- Step Change Debt Charity.
- National Debtline.
- Citizens Advice.
Be wary of debt management companies that charge for their services. Some may use the words ‘breathing space’ in adverts or on websites but could be offering debt management plans that you pay for instead.
To apply for a mental health crisis breathing space you will need a professional mental health professional to complete your application. You won’t need to speak to the debt adviser yourself but they will need a form from a mental health professional before they can look at your application.
How the debt adviser helps
First the adviser will look at your situation to see if you could meet your payments through help with budgeting or prioritising debts.
If you can’t meet your debt repayments they could recommend breathing space as suitable option for you.
During a standard breathing space you’re expected to work with your adviser to find a longer term debt solution and report any changes to them.
The adviser carries out a midway review to check that you’re following their advice. They could cancel the breathing space if you don’t stay in contact or provide the information they need.
With a mental health crisis breathing space you’re not expected to stay in touch with your adviser. The adviser will have a named contact on your mental health care team to confirm you’re still receiving treatment.
How long breathing space lasts
A standard breathing space lasts for 60 days.
A mental health crisis breathing space doesn’t have a time limit. It usually ends 30 days after you stop receiving crisis treatment but you can apply again if you need to in the future.
Your adviser may be able to provide ongoing help when breathing space ends.
What happens to your debts?
Breathing space is not a payment holiday.
You must pay your rent and make payments to other debts if you can.
But if you can’t pay, your creditors must:
- Stop asking for payments.
- Freeze interest, fees and charges on the arrears.
- Pause any enforcement action through the courts, debt collectors or bailiffs.
You can use the breathing space to work out a longer term debt solution with your adviser.
What happens to your home?
Landlords cannot give notice or evict you for rent arrears during breathing space, although this is always our last option.
You may be able to use the breathing space to reduce your rent arrears or come up with an affordable repayment plan.
When the eviction process does not stop
Breathing space does not stop the Section 21 Eviction Process for assured shorthold (known as Starter) tenants.
Landlords can also give notice or take eviction action for other reasons during breathing space. For example, antisocial behaviour.