The mortgage lenders are in heavy competition with each other to attract the most customers, and although some offer other incentives like free valuation and set up fees, it's the interest rate that's the real clincher. As long as this is the case, Rate Tarts will prosper!

Some lenders have increased their up-front charges in an attempt to beat the Rate Tarts, and others offer incentives to existing customers to retain their business. However, raising up-front charges will do more harm than good, reducing the lenders market share, even though their profit margins might be a little more healthy.

Birmingham Midshires are the perfect example of this, they are currently offering a 3.89% two year fixed deal, looks like a great deal? Read the small print and it turns out that the arrangement fee is vastly over the average of £500, it's a gargantuan £1,499! If you spread the fee over two years at £749.50 per year, it's works out as adding another 0.75% interest on a £100,000 mortgage.

If you decide to remortgage, there's a couple of things you need to do first:

1. Add up all the costs of remortgaging, including:

- the valuation fee (around £250 on a £100,000 mortgage);
- the arrangement fee (around £500);
- a booking fee (could be around £50?);
- legal fees (approximately £350 on a £100,000 mortgage);
- the cost of any redemption penalties for leaving your current lender.

2. Now it's time to call your mortgage provider. Tell them that you want to switch your mortgage because you have found a better deal. Your lender may well offer you a deal to match the new deal. Of course, if you didn't ring, they'd never offer you that better deal, but lenders sometimes respond well to pressure, so give that a try before switching.

Once you have talked to your lender and have details of all costs involved with switching mortgages, it's up to you to decide if it's worth it. If your lender does provide you with an improved quote, that should make the decision a lot easier.