The number of fee-free deals on fixed rate mortgages has more than doubled in the past year according to research by independent financial service Moneyfacts.
One year ago the number of fee-free fixed rate deals was 556; by the middle of this year that figure had reached 929; now it is a startling 1,162.
Meanwhile the number of fixed rate mortgage products has risen only very slightly, meaning far more lenders are now reducing or completely dropping their fees to win customers in an increasingly-competitive market.
However, for those fixed rate mortgages with fees the charges have risen from an average £954 to £984 over one year.
Moneyfacts says this is down to an attempt by providers to compensate some of their low rate deals with a higher fee, particularly as the average two-year fixed rate has fallen from 2.67 per cent to 2.34 per cent in the last 12 months.
“Too many borrowers focus their attention on achieving the lowest rate possible and miss out on some of the deals that end up being the most cost-effective. For example, borrowers opting for the lowest two-year fixed rate deal at 75 per cent loan-to-value would be £1,072 worse off compared to a borrower who opted for the lowest deal with no fee” according to Moneyfacts spokeswoman Charlotte Nelson.
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