Mortgage Recommendations: Our Top Tips

We have picked out the mortgages that offer the best value across the range of different types of products on the market.

But the first thing you must do is decide which of these types of mortgage best suits you - do you need the certainty of knowing exactly how much you are going to be paying out each month? Or is flexibility and the ability to pay off a chunk of your debt at a time that suits you all important?

Only once you have chosen the type of mortgage you need should you look at individual products. And with over 2,000 different products currently on the market, even then it often pays to get an independent broker to find the best one for you.

These tips are merely indicative of the best mortgages around at the moment - they may not suit every individual's requirements.

Fixed rate: Northern Rock (3/5 stars)

If you don't want to have to worry about your mortgage fluctuating, then it's worth choosing a fixed rate, even though they tend to be more expensive than discounted-rate mortgages.

Northern Rock has a very competitive two-year fixed rate mortgage at 3.99 per cent, available if you want to borrow more than GBP100,000. The maximum loan to value is 85 per cent.

But be warned: Northern Rock charges a swingeing arrangement fee of 2.5 per cent, which most borrowers add to the mortgage and pay off over the full term. "It's now common for lenders to charge a high fee on a low fixed rate, but this is such a good rate that it can still work out cheaper than the alternatives, depending on how much you borrow," says Michael Brill, at adviser Baronworth.

And there is no early redemption charge so, if your circumstances change, you are free to get out of the mortgage. As Mr Brill points out: "They can afford to do away with early redemption penalties, given the fact that they are charging such a massive fee upfront."

Tracker: Nationwide (3/5 stars)

It makes sense to use tracker products, rather than ordinary discounts that follow the lender's SVR, because trackers follow the Bank of England base rate (unlike SVR-linked mortgages) - so any fall in interest rates is bound to be fully reflected in monthly payments.

The Nationwide runs a base-rate tracker with a 0.27 per cent discount (currently standing at 4.73 per cent), available on up to 90 per cent loan to value and with an arrangement fee of GBP599. After the two-year tracker period, it reverts to the standard variable rate - currently 6.24 per cent - at which point it's time to find yourself another deal.

Tracker: BMS (3/5 stars)

Mr Brill also picks out the two-year Birmingham Midshires tracker currently at 4.35 per cent. The downside is that the lender charges a relatively high 1 per cent fee, which is normally added onto the mortgage debt. "If money's tight, the BMS tracker is very competitive and works out at a lower monthly payment than Nationwide, even with the arrangement fee included. But because more of it is going on the arrangement fee costs, you will actually have a slightly larger mortgage debt outstanding at the end of the two-year period," he says.

Offset: Hinckley

Because offset mortgages tend to come at a small premium, it's important to make effective use of the offsetting facility, whereby you reduce the amount of debt on which you actually pay interest. One way, if you have substantial savings, is to select a mortgage that doesn't involve a current account but allows you to offset your savings account (ideally transferring in any spare cash from your external current account at the end of each month). Hinckley Building Society has a very competitive savings-account offset mortgage at Bank of England base rate (BBR) + 0.14 per cent - currently 5.14 per cent - for the mortgage term. There are no redemption terms involved.

Offset: Clydesdale (4/5 stars)

Another option, if you have a good monthly income, is to look for a current-account offset mortgage. Most offset customers take a long- term view of their mortgage anyway - as the benefits of offsetting accrue over the years - but it makes particular sense to avoid short-term cheap deals for current-account mortgages, as you would have to switch your everyday bank arrangements with standing orders, direct debits and other bills if you move to another lender at the end of the deal. But a competitive lifetime tracker is a good arrangement. Clydesdale Bank is marketing a full current-account offset mortgage as a lifetime tracker at BBR + 0.35 per cent.

Buy-to-let: Portman Building Society (4/5 stars)

The market for buy-to-let mortgages has become much more competitive in recent years, with lots of new entrants coming to the market, including heavyweights such as Alliance & Leicester and Abbey. But some of the smaller building societies are competitive, too, and none more so than Portman. It is currently offering a rate of just 3.99 per cent for a fixed term until January 2009. The fee is a very competitive 0.5 per cent of the advance and there is no limit on the number of properties you can use the money for. The only downside is the extended lock-in period - you will have to pay a redemption penalty if you change mortgages before 2013.