Any homeowners wanting to end their current loan or mortgage may find that they need to introduce equity to secure a competitive rate on their next deal.

This is the opinion of Al Elliot, an advisor at the Homeowners Advice Centre, who believes that reverting to standard variable rates (SVR) may also be beneficial as costs may be lower due to the base rate reduction recently announced by the Bank of England.

Mr Elliot said that if people do choose to exit on to SVR, "the only consolation is that with the base rate coming down, many lenders' SVR is lower, so it's likely that the jump won't be quite as big as borrowers expected."

He added that lenders may not pass on the interest rate cut to their customers as they may risk a "cash-flow crisis".

In October 2008 the Council of Mortgage Lenders said that they expected around 45,000 homes to be repossessed in 2008.

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