The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 (the Regulations) are likely to delay landlords recovering debts and their properties from struggling tenants.
From 4 May 2021, individuals can apply for a moratorium (or “breathing space”) to shield debts from creditors’ enforcement action. The Regulations are the latest in a series of measures to protect tenants who have suffered during the COVID-19 pandemic. Where other measures helping corporate tenants are temporary (for instance, the ban on forfeiture for non-payment of rent recently extended until 30 June 2021), the Regulations are here to stay.
Any landlord letting a premises to an individual may face a moratorium. Both residential and commercial landlords with individual tenants should consider how the Regulations might affect them.
This article considers the main features of the Regulations through the lens of the landlord and tenant relationship, in which the creditor is typically the landlord.