With the flexible mortgage, it is a simple matter to stay one step ahead of the market and keep your payments at a reasonable cost in order to take advantage of the lowest prices that exist on the mortgage market. Experts agree that anyone looking to take out a flexible mortgage should wait as long as they possibly can in order for the prices of the housing market to continue to fall. With this outlook, the flexible mortgage can save you all manner of money and allow you to purchase the home that you need with the terms that suit you.

“Lenders are able to use arrangement fees as a hidden way of boosting the overall cost of the mortgage,” said David Black of Defaqto. “It’s worrying that some of the lenders taking the most business have introduced the biggest fee increases.”

“Lenders are clearly still intent on improving margins: this situation is unlikely to change in the near future,” said Melanie Bien at independent broker Savills Private Finance.

However, there has been some relief with swap rates, ‘Swap rates - the rates at which banks lend to each other - have fallen by about half a percentage point in the past month, so it is no surprise that fixed rates have started to fall. It is a huge relief to borrowers,” added Bien.

Alison Hatrick of the National Association of Estate Agents (NAEA) said “There is a lot of stock on the market and not so many buyers around so that is obviously not good news, but there has been a reversal in the trend to buy first and sell later.”

“People are putting their homes up for sale first and that means they can afford to sit it out so we are not necessarily seeing big price drops because people are not prepared to agree to that.”

“The £2,000 grant for first-time buyers - which they withdrew - would have helped the situation, the measures they are taking do not suit the market as a whole.”

Louis Cuming of MoneySupermarket stated, “Landlords wishing to remortgage buy-to-let properties will find it difficult, with lenders demanding sizeable deposits or charging higher rates. This could force landlords to re-evaluate whether it is worthwhile staying in the sector in the current climate. With property prices falling though, there may well be many landlords having to sell their investment at a loss.”

Melanie Bien, of Savills Private Finance, a mortgage broker, said: “The cost of remortgaging means many are staying put on their lender’s standard variable rate rather than pay a fee of 2 per cent or 2.5 per cent to go onto an unspectacular rate.”

Francis Ghiloni, mform.co.uk Marketing and Business Development Director, said: “The end of the housing market boom with house prices dropping ought to be good news for first-time buyers who can finally be in a position to afford the home that was out of reach.

“However with the mortgage market contracting lenders are getting tougher on how much they’ll lend and what level of deposit they’ll demand which means first-time buyers are yet to see much benefit from the house price slide.

“Availability remains the major issue for the mortgage market but the focus for borrowers should still be on the true cost of their loan taking into account all fees as well as the monthly payments.”

“At the same time lenders are increasingly keen on signing customers up to long-term deals which offer them certainty,” explained Sean Gardner, director of MoneyExpert.com. “Long-term fixed-rate mortgages are no longer an oddity. And with competitive rates of interest in some circumstances they may well be worth considering.”

NatWest’s offer for a free remortgage has intrigued many experts. Gardener continues, Sean Gardner, Director, MoneyExpert.com, said: “With higher mortgage fees very much in the spotlight this new offer from NatWest is certainly eye-catching. When some other providers are charging arrangement fees approaching £1,500 the offer of re-mortgaging fee-free is very attractive. The early redemption charge of 3% might be a sticking point but plenty of other providers charge as high as 4% or 5%.”

“We are overwhelmed by the early response - from lenders, housebuilders, financial advisors and mortgage brokers,” said Market- Guard chief executive Chris Taylor. “We have established a strong demand for the product, which will sell through financial advisors and brokers in a few weeks’ time.”

“Our research shows that even the slightest increase in Bank of England base rate could tip people over the edge,” added Taylor. “Our product can bring some stability to millions of borrowers either on variable rate mortgages, or nearing the end of fixed rate deals with little hope of getting a new fix because of tightened lending criteria or the prohibitive cost of remortgaging.”

“There doesn’t appear to be any let up in the misery for borrowers. Lenders need to start playing the game fairly and pass on the cut in swap rates as quickly as they pass on the increase,” said Darren Cook, of Moneyfacts.

“Neither the cost nor the availability of wholesale funds has improved for lenders since the Bank of England launched its special liquidity scheme, helpful though that scheme is,” said CML director general Michael Coogan.

“This means that cost and availability to customers has not improved either. And this in turn means that consumers are now beginning to give up and demand is falling, with confidence in the housing market falling with it.”

Robin Amlot with MoneyExtra stated, “Mortgage interest rates, in general, are cheaper now than they have been for more than a year but it’s impossible for many potential buyers to find a lender because of the size of deposit they’re being asked to provide.”

“Banks are more likely to be able to cross-sell other profitable products to customers earning a reasonable amount, and, in many cases, persuade them to migrate to added value current accounts,” said David Black with the financial firm Defaqto. “It’s disappointing to see Nat-ionwide reduce their rates for those current account customers depositing between £1,000 and £1,499 each month and it’s also somewhat against the current trend, given that Lloyds TSB recently upped their rate from 4.25 to 6 per cent.”

But Melanie Bien, a director of independent mortgage broker Savills Private Finance, said: “Swaps have since jumped following the Bank of England’s gloomy inflation outlook which means that interest rates are unlikely to fall anytime soon — indeed, the next move may be upwards. Borrowers who see a rate they like the look of should move quickly to secure it.” 

Matthew Carter, divisional director for mortgages at Nationwide, said: “We have seen continued large rises in money market rates together with further competitor activity and as a result it has been necessary to increase the rates on our range of mortgages. While markets remain volatile we can expect to see frequent changes to fixed rate mortgages across the industry.”