The flat fees for buy-to-let mortgages are at their lowest point for twelve months, according to Mortgages for Business.
The broker’s latest Buy to Let Mortgage Costs Index says the average flat fee fell to £1,370 in Q2 from £1,446 in Q1.
But Mortgages for Business points out that percentage-based fees are becoming more common as lenders seek to keep interest rates low while still allowing profits to rise with larger loans.
Percentage based fees now apply to 48 per cent of buy-to-let mortgage products, having overtaken flat fees on product availability at the start of the year.
These products have increased in number in every quarter since Q2 2016.
There has also been a cut in fee-free options on the market.
The broker found just 11 per cent of buy-to-let loans had no fees in Q2, down from 15 per cent in Q1.
Mortgages for Business chief operating officer Steve Olejnik says: “With interest rates still at exceptional lows, it’s all the more important to make sure you look at any additional charges when taking a buy-to-let mortgage.
“It is therefore promising to see a reduction in the average flat fee charged for mortgage products.”