“With it looking increasingly likely that it will take another couple of years for the market to recover, borrowers may be better placed to opt against short-term fixed rate mortgages,” says Jonathan Cornell of Hamptons Mortgages. “The rising costs of short-term fixed rate mortgages means that the average arrangement fee on a two-year deal is £1,168, with some as high as £2,000. Some long-term deals are priced more competitively – and homeowners can avoid the hassle of having to remortgage every two years.”

7. But if you can take a risk, trackers look best

“Any borrower who does not require the absolute security of a fixed rate mortgage would simply be crackers not to take a cracker at the moment,” says Drew Wotherspoon of Charcol, another broker. The reason for this is that, although inflation is high at the moment, and is set to rise further, it is forecast to all sharply as the economy slows. “As a result, it is highly probably that the bank base rate will fall sharply in 2009,” Wotherspoon says.

8. Pay attention to the SVR…

Borrowers are now spending longer on their lender’s standard variable (SVR) rate than they used to do, research from Nationwide shows. Unless you are moving seamlessly from fixed rate deal to fixed rate deal, the SVR becomes important – and there is significant variation between lenders: for example, Nationwide’s SVR is currently 6.49 per cent, while Halifax charges 7 per cent and Abbey 7.90 per cent.

9. …and to arrangement fees

While fixed rates have been coming down recently, a number of lenders have been raising arrangement fees at the same time in order to protect their margins. Moneyfacts reports that in the month to August 6, the average two-year fixed rate fell from 7.08 per cent to 6.9 per cent, however, at the same time the average arrangement fee rose by £100. “Borrowers should consider the overall combination of the headline rate, fee and the lender’s SVR,” says Martyn Dyson, head of mortgages at Nationwide.

10. Sometimes a higher fee is a better bet

If you are struggling to get a good rate, it might be worth paying a higher fee., “Some lenders offer a choice of paying a higher arrangement fee to get a lower mortgage rate,” says Ray Boulger of Charcol. “The fee is added to the mortgage – but in some cases it is better to have a slightly bigger mortgage than one with a higher rate that you cannot afford.”

Times recommends

• Second homes: credit crunch casualty or money-spinner?
• How I built my own sliding house
• Top 10 incentives for house buyers