Meanwhile, the availability of incentives traditionally used to attract borrowers is on the decline. The proportion of fixed rate mortgage deals offering free or refunded valuation fees has decreased to 73%, down from 75% in early March 2023. Similarly, offers that include free or refunded legal fees have seen a slight drop, moving to 44% from 45% in the same period.
A significant reduction has also been observed in the availability of cashback offers, which have fallen by 9% since March 2023.
“Borrowers concerned about rising fixed mortgage rates would be wise not to rush when comparing deals and ensure they consider the overall true cost package, as the average mortgage fee has crept up,” said Rachel Springall (pictured), finance expert at Moneyfactscompare.co.uk. “There is an abundance of deals to suit different needs, some may be headline-grabbing rates, but these can also charge a high upfront fee.
“The best mortgage will come down to how much someone needs to borrow and for how long, so seeking independent advice to crunch the numbers is wise. Those borrowers looking to remortgage right now will find some of the lowest rates will cost them more than £1,000 in a product fee, but a mortgage with a slightly higher initial fixed rate and lower product fee could be a better package based on true cost.
Springall added that mortgage interest rates remain volatile, and this may well be the case for the next few weeks.