The Bank of England has cut rates by 25 basis points to 4.75 per cent.

As widely expected, the MPC voted to reduce interest rates by a quarter-point to 4.75 per cent at today’s meeting.

This is hugely positive for borrowers, with the Bank of England doing the right thing given inflation is below the 2 per cent target. Those on base-rate trackers and variable-rate mortgages should see their monthly payments fall, and those savings will be gratefully welcomed by hard-pressed borrowers.

While we are seeing a slight increase in mortgage rates, existing borrowers should engage with a whole-of-market mortgage broker approximately six or seven months prior to the current deal ending to lock into a new deal. Should mortgages rates rise further, you will be assured that something has been reserved but if rates fall, you can ask your adviser to reivew what is available nearer the time.

New borrowers and first-time buyers should speak to a broker to run through the various schemes available to help them climb onto the property ladder, as well as how to make themselves as attractive as possible to prospective lenders.

We expect the MPC to continue on the anticipated path for base rate with further reductions in coming months, bringing further relief for homeowners and home ownership within the grasp of first-time buyers. However, what cannot be guaranteed is where rates end up, nor the pace it takes to get there. If you cannot afford to be wrong – that is, if rates were to rise you would struggle to pay the mortgage – then a fixed-rate mortgage usually makes sense.”