New buy-to-let fixed rate products on offer include:
- Two year fixed rate at 3.25% with a £1,995 product fee – a reduction of 0.13% (60% LTV)
- Two year fixed rate at 4.59% with no product fee – a reduction of 0.50% (60% LTV)
- Three year fixed rate at 4.69% with no product fee – a reduction of 0.90% (60% LTV)
New buy-to-let tracker products on offer include:
- Two year tracker at 3.55% with a £995 product fee – a reduction of 0.20% (60% LTV)
- Two year tracker at 2.89% with a 2.5% product fee – a reduction of 0.10% (60% LTV)
New buy-to-let products available exclusively through intermediaries:
- Two year fixed rate at 2.89% with a £2,495 product fee – a reduction of 0.30% (60% LTV)
- Two year fixed rate at 3.19% with a £2,495 product fee – a reduction of 0.15% (70% LTV)
All products will be available from Tuesday 3 December 2013, and cashback of £750 remains available across Virgin Money’s core range of buy-to-let products (excluding intermediary exclusives).
In addition, Virgin Money has announced plans to revise its policy for new, interest-only residential mortgage lending (including part repayment / part interest-only lending) in response to feedback from its intermediary partners. The policy changes announced today will be introduced on Monday 9 December 2013 and do not affect buy-to-let lending, or existing residential mortgage loans.
Virgin Money will remove the current minimum loan size of £300,000 for interest-only residential lending and instead introduce a minimum property value of £500,000 and a minimum gross income requirement of £100,000 in total for applicants (including bonuses). In addition, Virgin Money will no longer offer the option of interest-only lending to First Time Buyers.
Virgin Money continues to believe that residential interest-only mortgages remain an appropriate option for more experienced customers who can demonstrate confidence in repaying their loan at the end of its term through a clear and evidenced repayment plan.
As part of these changes, Virgin Money will also no longer accept the sale of a customer’s primary residence or the use of Cash ISAs as a repayment vehicle.
Other suitable repayment vehicles will continue to be accepted, subject to the usual criteria, including; investment plans, personal pension plans, endowment policies, sale of a property other than primary residence and a share portfolio.
There are no changes for existing interest-only loans, which are not impacted by the planned changes. Virgin Money’s interest-only policy for buy-to-let will also remain unchanged.
After the implementation of the changes on 9 December, Virgin Money will honour any interest-only or part repayment / part interest-only Decisions in Principle that have been approved under the previous interest-only policy for a period of 90 days from the date of the DIP.
Anthony Mooney, Director of Financial Services at Virgin Money, said:
“We are delighted to announce the launch of our new range of competitive buy-to-let products, which underlines the importance we place on this segment of the market. We are also announcing some changes to our residential interest-only lending policy that will take effect on 9 December. We are making these changes in response to feedback from our intermediary partners, and given our experience that the vast majority of interest-only customers have higher incomes and property values. We remain of the view that interest-only remains an important option for more experienced borrowers who have a clear and demonstrable repayment plan and our revised policy reflects that.”
"Whilst interest-only mortgages are an important part of the mortgage market, they represent around 10% of new mortgages at Virgin Money. The wider product range that appeals to the vast majority of Virgin Money mortgage customers remains unaffected by these changes."
