‘Breathing Space’ initiative – Beware?

by Readers Question

9:57 AM, 19th January 2021
About 3 months ago

‘Breathing Space’ initiative – Beware?

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‘Breathing Space’ initiative – Beware?

The NRLA has just sent details out about a new initiative for tenant debt management. Coming into force from May 4 2021, the Debt Respite Scheme (Breathing Space) allows people in England and Wales with unsustainable debts to arrange to enter a ‘breathing space’.

Once someone enters a breathing space their creditors are not allowed to contact them directly to request payment of the debt or take enforcement action to recover the debt (including by taking possession of property) while the breathing space is ongoing. This is designed to provide people in debt with enough time to find a solution for their financial problems.

While this legislation is aimed primarily at large lenders such as banks, the obligations apply to any creditor, including landlords. In particular, landlords who are seeking possession because of rent arrears will need to be aware of these restrictions as it can cause issues for Section 8 proceedings.

There are two types of breathing space that a tenant may enter into a standard breathing space and a mental health crisis breathing space.

For the most part, both types of breathing space operate in the same way. Creditors are prevented from taking steps to recover debt for the duration of the breathing space. However, the duration and frequency of the breathing spaces, as well as who can make the application will vary.
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My first reaction….hmmmm…. second reaction after reading it further details is………

If a tenant asks for this BEFORE you get a S8 or possession order in, you are inevitably more unlikely to get either any arrears OR them out of the property!

I am sure this will start a big debate, but if this is what it is heading towards, there is going to be another almighty wave of S8’s in the offing to avoid being trapped once one of these is issued.

Reluctant Landlord

Comments

Jon D

14:02 PM, 23rd January 2021
About 3 months ago

Yup. The Conservative party are clearly centrist, because that is where the easy choices are. All parties in most countries now look at polling data every day.
If the poll says 'protect tenants' that's what the govt will do. And so on.
This is data-driven democracy.
A dystopian future.

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