Breathing Space

The Breathing Space period is referred to as a moratorium. The Breathing Space scheme has two types of moratorium: a breathing space moratorium and a mental health crisis moratorium. The former applies generally to anyone in problem debt who would benefit from a breathing space period and the latter is specifically for those in problem debt who are receiving mental health crisis treatment.

 

Members with problem debt will have to apply to enter a ‘Breathing Space’ moratorium through an FCA approved debt advice provider. To qualify, you must be unlikely to repay some of the debt and a breathing space period is considered as an appropriate response to problem debt. You will be referred from debt advice providers who will work alongside the Insolvency Service to administer the Breathing Space scheme. The Insolvency Service will notify us when a relevant moratorium is entered or exited by a member and we will work alongside the debt advice provider during the breathing space period.

 

If we are notified by the Insolvency Service that a member has entered a ‘breathing space’ period, the member is protected from the accruing of fees and enforcement actions on their debt. This means that we are legally restricted from accruing interest and charges and taking a range of enforcement actions on debts which are subject to the Breathing Space scheme regulations.

 

If you would like more information on the Breathing Space Scheme you can visit the government website here