It also reduces selected fixed rates
Virgin Money has launched a range of broker exclusive products, including residential and buy-to-let fixes with rates under 5%.
The lender has introduced new two- and five-year fixed rates on its purchase exclusive fee-savers with free valuation range. Two-year deals at loan-to-values (LTV) of 65%, 75%, 85%, and 90% were launched with rates of 5.84%, 5.87%, 6.16%, and 6.21%, respectively. Five-year options at the same LTVs were priced at 5.15%, 5.18%, 5.37%, and 5.54%, respectively.
A couple of two- and five-year fixed rates were also launched as new buy-to-let exclusives with 3% fee. New 60% LTV two- and five-year fixes have rates of 4.87% and 4.97%, respectively, while new 75% LTV two- and five-year fixes have rates of 4.92% and 5.27%.
Virgin Money has also reduced selected rates, with purchase exclusive fixed rates with £1,295 fee cut by up to 0.22%, starting from 4.97%.
Remortgage exclusive fixed rates were also slashed by up to 0.21%, while BTL remortgage exclusive fixed rates with £2,195 fee were made available to purchase customers from 5.20%.
Selected product transfer fixed rates were also reduced by up to 0.37%, with rates now starting from 5.17%.
Meanwhile, brokers asked by news agency Newspage have welcomed Virgin Money’s new products and rate cuts.
Ranald Mitchell, director at Charwin Private Clients, called the move a huge step in the right direction, with a prime lender nudging rates below the 5% threshold.
“Competitors will follow suit, that is only a matter of time, as high street lenders try to make up lost ground in 2023,” Mitchell said. “Questions remain as to whether these latest interest rate cuts are far enough to jolt mortgage market confidence back to reasonable levels again.”
“It is great to be seeing rates below 5% again, and a clear sign that lenders are desperately fighting for market share as they are far behind targets on completions and lending volumes,” added Stephen Perkins, managing director at Yellow Brick Mortgages. “Rates in the 4% to 5% will be the new normal as things continue to settle.”
However, Richard Campo, founder of Rose Capital Partners, believed that while it was great to see the return of sub-5% fixed rates, it was too early to start recommending them as a default to clients.
“The inflation figures, and of course, MPC meeting this week will have a huge sway on what happens over the rest of the year, but until we know the outcome of those factors at the end of the week, I would still recommend that clients stay on a penalty-free tracker for the time being, where appropriate to do so,” Campo explained.
“Pushing on with more rate rises after the expected 0.25% hike on Thursday is only going to inflict more unnecessary pain on the economy in my opinion. I would not be surprised at all if rates come down next year from both the BoE and lenders faster than expected, so fixing in now may start to look expensive in years three, four, or five of the current batch of fixed rates.”
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