Mortgage lenders and Chancellor Jeremy Hunt have agreed that people should be given a 12-month break before repossession proceedings start amid soaring interest rates.

After the rise of the base rate to 5%, Mr Hunt met with leaders of financial institutions including Lloyds, NatWest, Barclays and Virgin Money.

They agreed that the repossession break should be introduced.

Politics latest: Chancellor meets with mortgage lenders after interest rate hike

Also approved in the Downing Street summit was an option for people to go to their banks or lenders and speak about their options, if they are struggling with repayments, without it having an impact on their credit rating.

And speaking this morning, Mr Hunt said that people who change the length of their repayment term or go on to interest-only plans can reverse their decision within six months without it impacting their credit rating.

But there was no announcement of support for people who rent, who are facing landlords hiking prices or selling properties from under them due to rising mortgage costs.

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The chancellor said: “There are two groups of people that we’re particularly worried about.

“The first are people who are at real risk of losing their homes because they fall behind in their mortgage payments.

“And the second are people who are having to change their mortgage because their fixed rate comes to an end, and they’re worried about the impact on their family finances have higher mortgage rates.”