MORTGAGE borrowers should be an average £90 a month better off after the latest interest rate cut by the Bank of England.

The decision by the Monetary Policy Committee to further reduce rates by 0.25 per cent will save homeowners with a £60,000 mortgage around £9 a month.

Combine this with other interest-rate cuts already implemented this year and repayments on a £60,000 mortgage should fall from £377.46 to £368.45.

Mortgages are now at their cheapest for more than 45 years - the last time repayments were this low was in January 1964 - as the Bank of England has cut interest rates from six to 4.5 per cent so far this year.

Bob Pannell, head of research at The Council of Mortgage Lenders (CML) said the latest cut would further underpin consumer confidence.

‘‘While the housing and mortgage markets have been performing strongly, the current uncertainty has nevertheless been casting a shadow,’’ he said.

‘‘This reduction in mortgage rates will therefore be welcomed by borrowers who may be feeling less certain about their future financial outlook.’’

Most major lenders announced they were passing on the full reduction. Halifax, the UK’s biggest lender, said its variable rate would come down to 5.5 per cent from November 1.

Its Internet subsidiary, Intelligent Finance, announced its discounted mortgage rate will be reduced to 3.85 per cent from November 13, while its variable rate will reduce from 5.5 to 5.35 per cent.

The decision reflects the fact that it already offers one of the lowest variable rates in the market with many customers enjoying an even lower effective rate by taking advantage of Intelligent Finance’s offset offer.

Nationwide is cutting its base mortgage rate to 5.24 per cent from 5.49 per cent, its lowest since 1955.

Standard variable rates and Base Rate Tracker products from Abbey National, Bristol and West, First Direct, Virgin and Woolwich, have all been cut by the full amount.

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