Many of the largest banks and building societies have reduced the overall cost of two and five-year fixes at 75 per cent loan to value (LTV) since January, rate monitoring firm Moneyfacts found.

Headline rates have not changed significantly, but lenders have instead focused on changes to product fees to become more competitive in the market.

For example, the true cost, including fees, of Barclays two year fixed-rate at 75 per cent LTV has fallen from 2.08 per cent in January to 1.96 per cent since January.

The true rate takes into account the overall cost of products as well as the interest rate.

At the same time the true cost of Coventry Building Society’s five-year fixed rate at 75 per cent has dropped to 1.78 per cent from 1.92 per cent.

Moneyfacts spokeswoman Eleanor Williams said: “As our data shows, the majority of the top 10 mortgage lenders have made reductions to the true rates on their two and five-year fixed rate deals at 75 per cent LTV in this early part of 2020.

“With consumers becoming increasingly savvy, many are aware that interest rates are at historic lows for mortgages, and so the next logical step for them is to consider the overall package of a deal.”

She continued: “It is encouraging to see reductions from so many providers, whether these shifts are being applied to the interest rates themselves or to the overall package offered.

“Considering that UK Finance figures show that gross mortgage lending declined by 0.4 per cent in 2019, it demonstrates how keen lenders are to compete for business despite ever-tightening margins, and it also implies they are keeping in mind that borrowers are now enticed by more than just a low interest rate.”