The aim of the extension is to offer reassurance to residential and buy-to-let borrowers they will not have their home repossessed if they fall into financial difficulty as a result of the latest lockdown.

It comes after the government said it would extend the ban on bailiff activity in England until 21 February. In Wales and Scotland rental evictions have been prohibited until 31 March.

Under the extension of latest repossession ban lenders who are members of UK Finance and the Building Societies Association (BSA) will agree not to seek or enforce a warrant for possession before 1 April 2021.

This is unless there are ‘exceptional circumstances’ – for example if a customer requests proceedings to continue or when the property is in vacant measures.

The moratorium will have been in place for a year when its new ending of 1 April arrives. Not everyone in the industry welcomes the measure – this week the Association of Short Term Lenders (ASTL) said an extension would ‘disproportionately impact’ short terms lenders because of the nature of their business.

However, Eric Leenders, managing director of personal finance at UK Finance, said: “The banking and finance industry is committed to providing ongoing support to those facing financial difficulty as a result of the pandemic.

“The industry is fully supportive of a moratorium on possessions remaining in place until 1 April 2021 to ensure customers do not lose their home at this difficult time.

“This is part of a package of support provided by lenders for those who need it, including payment deferrals and tailored assistance. It is vital that customers who are concerned about their finances go online or contact their lender to understand what options and support are available to them.”

Meanwhile, Paul Broadhead, head of mortgage and housing policy at the BSA, said: “Mortgage lenders recognise the unique circumstances which are affecting some borrowers during the pandemic, a situation which can only be exacerbated by the current lockdown and the need for some businesses to temporarily close.

“Normal forbearance measures will continue to be in operation however long the pandemic persists, but we are also asking Government to do their part, in the first instance by reducing the time that borrowers must wait for a Support for Mortgage Interest loan from the current 39 weeks to 13 weeks, adding to the options available, particularly for those who were in financial difficulty before the pandemic.”