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The CML said it was undertaking a wide range of activities to ensure all possible avenues are being followed to minimise difficulties experienced by borrowers.

CML members have committed to specific measures to ensure repossessions are a measure of last resort.

Members of the CML have said they would analyse their existing arrears management policies and implement any changes identified as a result of the industry guidance that the trade body is preparing.

Lenders will also provide information for consumers on their own arrears management process to help borrowers understand what to expect and how they will be treated fairly.

Mortgage provides have also pledged to support a pre-action protocol for mortgage cases for use before court proceedings to ensure that only appropriate cases go to court.

The letter also stated lenders will inform borrowers in good time when they are coming out of initial deals onto higher rates with increased monthly repayments, and encourage them to make contact if a financial problem is likely to arise.