Reports suggest that up to 1million households have borrowed money on credit cards in order to pay their mortgage or rent over the past year; meaning tenant defaults could soar.

A survey by the housing charity Shelter found that 6% of the 2,022 respondents had used a credit card to pay their mortgage or rent in the last 12months - suggesting a national figure of more than 1million people. This figure was even higher in London at 12%.

Working-class professionals were most likely to use credit cards to pay their rent with 8% admitting to doing this. Meanwhile, 4% of middle-class professionals admitted this in comparison.

It is not advisable to rely on credit cards to cover housing costs as this can lead to a vicious cycle of growing debt, resulting in long term financial problems and even the loss of property.

According to a comparison website, the average credit card interest rate, at 18.3%, is nearly four times the average mortgage interest rate.

A spokesperson for Shelter said: “Credit card companies have to recover their debts and are not subject to the same rules as mortgage lenders. Once they obtain a charging order on people’s property, credit card companies can go back to the court for a possession order to force a sale to recover the debt.”

Tenants are being urged to seek advice as soon as possible so that they don’t lose their homes.

Landlords can take out a legal protection and rent guarantee insurance policy in order to cover themselves from financial loss if their tenants can’t pay the rent.

For more information on cheap landlord insurance as well as tenant’s contents insurance.