An industry body has attempted to give homeowners facing "pain and anxiety" hope over the transfer of fixed rate mortgages.

Alistair Darling said the Council of Mortgage Lenders (CML) is trying to ensure there is a smooth transition to new loans despite the current downturn.

The Chancellor announced to MPs he would be meeting CML next week to discuss how rates could be kept as "low as possible" for people whose deals were coming to an end.

The Government is looking at a "range of measures" to help people keep up their mortgage repayments.

At Commons Question Time, Labour's Karen Buck said homeowners were experiencing "real pain and anxiety" - particularly as fixed-term deals, offered before the current lending crisis, ended.

Mr Darling said: "We have had discussions with the CML, and I expect to meet them again next week, to discuss how we can ensure that when people come off fixed-term mortgages and then look at the options in front of them, they can have proper advice and hopefully get on to further rates that are as low as possible.

"The CML tell me that they hope they can make considerable progress in ensuring there is that smooth transition, because we want to ensure that people get on to the lowest possible mortgage, especially at this time."

Labour's Sally Keeble, a member of the Treasury Select Committee, urged the Chancellor to do more to help homeowners whose incomes had fallen as a result of difficulties in the economy.

Mr Darling, who appeared before the committee to defend his handling of the 10p tax rate abolition, said: "That is something we clearly need to look at as part of a range of measures to help people."

He added that the increase in the personal allowance - part of the £2.7 billion compensation package announced following the 10p row - would help.

Michael Fallon, the senior Tory on the select committee, said the mortgage market would be working better if the Chancellor had not "dithered and delayed" over banking reforms promised following the collapse of Northern Rock.

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