People with serious debt problems across the UK will soon be given protections from their creditors for a period of 60 days if they engage with professional debt advisers and seek out long-term solutions to their financial issues.
Plans to that effect have been announced by the government, with relevant laws on the subject due to be introduced from 2021.
Under the terms of the plans, interest payments and enforcement actions from debt collectors will be halted for almost two months as soon as indebted consumers officially register their intention to get third party help in turning around their circumstances.
Hopes are that the ‘breathing space’ legislation will succeed in giving large numbers of people across the country, including in Scotland, a better chance of sorting out their debt problems.
Debts that will be covered by the incoming laws include those involving local and central government agencies, who have become some of the most persistent and problematic of creditors in recent years from the point of view of indebted individuals and households.
Another element of the newly announced plans is that anyone with mental health issues, as well as debt problems, will be given legal protections from their creditors while they get whatever treatment they might need.
People who have mental health problems will not be obliged to seek debt advice while they access medical expert attention and their ‘breathing space’ protections from creditors will last for the duration of their treatments.
“No one should be stuck in an endless cycle of debt and facing the ever-looming threat of invasive debt collectors,” said city minister John Glenn MP.
“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.”
“This scheme could genuinely save lives,” said Helen Undy from the Money and Mental Health Policy Institute.
“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.”
If you live anywhere in Scotland and you’re in need of expert debt advice then Scotland Debt Solutions can help. Contact us directly to arrange a FREE and confidential consultation.
The UK’s financial services regulator has told banks and other lenders they ought to give their customers a break from repayments if they need one as the coronavirus crisis unfolds.
The Scottish government has taken a series of steps that it hopes will help to ease some of the financial pressures being felt by people with debt problems across the country.
Our Scottish based team can help advise you on your debt problems.