A couple of new remortgage exclusives come with a 1% product fee
Virgin Money has launched a new set of fixed rate deals across its ranges of remortgage and purchase exclusives.
A couple of new remortgage exclusives with a 1% fee, free valuation, and free legals were announced by the lender, with the 60% and the 70% loan-to-value deals priced at 5.09% and 5.15%, respectively.
There are also new remortgage exclusives with free valuation and £250 cashback, as well as purchase exclusives with free valuation.
Virgin Money also announced rate reductions of five to 15 basis points (bps).
The lender’s 90% LTV purchase exclusives were reduced by up to 10bps, with rates starting from 5.11%, while buy-to-let portfolio remortgage and purchase exclusives with 3% fee were cut by 5bps, with rates starting from 4.97%.
Selected product transfer fixed rates, as well as selected core purchase and remortgage fixed rates, were slashed by up to 15bps, with rates starting from 4.89%.
Meanwhile, selected purchase and remortgage freedom-to-fix rates were increased by 5bps, with rates starting from 5.60%.
The lender’s current product rates can be accessed online through its mortgage update.
“We have reintroduced our intermediary exclusive products and made a number of reductions across our residential and buy-to-let range, supporting all segments of the market,” said Richard Walker, head of intermediary sales at Virgin Money.
“These exclusives consist of both purchase and remortgage products, including a new range of remortgage two-year fixed rates with a 1% fee offering a lower monthly payment.”
Brokers react to addition of product fee
Brokers, who provided comments to news agency Newspage, said the percentage fee on the two-year fixed rate should be carefully considered, with one saying the 1% fee would not make the product cheaper for some clients, even with the lowered rates.
“While it is great to see two-year fixed rates edge ever closer to the sub-5% zone, the 1% product fee on a two-year deal will likely not be cost-effective for most borrowers,” said Stephen Perkins, managing director at Yellow Brick Mortgages, awardee for The Best Mortgage Companies to Work for in the UK. “However, low rates will no doubt attract some borrowers as Virgin is fighting hard for some market share to hit its year-end lending figures.”
Ranald Mitchell, director at Charwin Private Clients, added that while it was good to see more rate reductions, it was the introduction of percentage fees rather than flat product fees that grabbed the attention.
“Whether these will benefit any particular case is entirely dependent on that set of circumstances, but there will be benefits to some,” Mitchell pointed out. “It seems like the offsetting of mortgage interest to fees is becoming more of a thing in the mortgage space.”
For Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management, “rate reductions are always a move in the right direction, even with a 1% fee.”
“The fee won’t work for everyone, but this is where having qualified advice prevails, as borrowers can assess all the options that are available to them and make an informed decision based on their circumstances and requirements,” she said.
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, Twitter, and LinkedIn.
