Over a million people are relying on their overdrafts to cover rent or mortgage payments, research by Comparethemarket has found.

The comparison site says that 13 per cent or one in 10 UK adults are regularly going into the red to cover their housing costs.

Of these, a fifth use their overdraft to cover the full payment amount, while a quarter use it to cover, on average, half of the cost.

Rents are rising at their fastest pace for three years, with the average tenant paying £886, according to Hometrack figures.

Meanwhile the average mortgage payment is £680 per month according to Office for National Statistics data.

Comparethemarket head of money John Crossley says overdrafts are an expensive way to borrow as many banks have moved to charging flat rate of 39.9 per cent in response to regulatory changes.

He says: “During the course of life we will all have rainy day moments when we will need to use emergency funds. 

“On these occasions, people need pots of money to dip into – a savings nest egg. 

“Relying on overdrafts to fund regular bills, including mortgage or rental payments, can be a costly way of managing household finances.”

Crossley adds: “With the rise in overdraft fees, there are other solutions available to pay off debt in a responsible way.  

“Borrowers should ensure they only borrow what they can repay and use a soft eligibility checker to prevent damaging their credit score.”