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Virgin Money launches sub-4% mortgages as rate war heats up – who’ll be next?

Nick Cheek
Written By:
Nick Cheek
Posted:
Updated:
09/02/2023

Following the lead taken by HSBC on Tuesday, Virgin Money has now added sub-4% mortgages to its roster of products.

The mortgage rate war is beginning to heat up as another bank releases sub-4% mortgage deals. Virgin Money has launched a five-year fixed rate remortgage deal at 3.95%, at 65% loan to value (LTV) with a £995 fee, reduced by up to 0.25%. It is available through brokers.

In addition, the bank has also issued a purchase five-year deal with a £1,495 fee which has been reduced by up to 0.18% with rates now starting from 3.99%. Again, it is available through brokers only.

The move comes just days after HSBC announced a raft of rate reductions across almost every fixed rate mortgage, including reducing a five-year fixed rate to under 4% for the first time since September 2022.

On these deals, financial analysts Moneyfacts noted that: “Virgin Money offers the lowest five-year fixed rate on the market with a deal that comes with a free valuation and £500 cashback. The other sub 4% five-year fixed mortgage comes from HSBC, which sets its rate at 3.99%. This includes a free valuation and free legal fees while commanding a £999 product fee. It can finance up to 60% of your home and earns itself a position on Moneyfacts Best Buy tables.”

More from Virgin Money

Alongside its sub-4% deals, the lender is now offering a 95% LTV five-year fix fee-saver at 5.09%, as well as a 10-year equivalent at 5.59%.

At the same time, Virgin has cut fixed rates between 65% and 85% LTV by up to 0.19% on its core range.

Exclusive rates between 75% and 90% LTV on five-year fixes with £995 fee have been cut by up to 0.12% to start from 4.22%.

Richard Walker, head of intermediary sales at Virgin Money, said: “Many borrowers, including first time buyers, are looking for a longer-term product which guarantees a fixed rate and a consistent payment for the term of the product.

“These new five and 10- year fixed rates at 95% LTV offer exactly that, and mean more aspiring home owners can get their foot on the housing ladder and get the keys to their first property.

“We’ve also refreshed our range of intermediary exclusives, including competitive five-year fixed rates starting from 3.95%, as we continue to support many types of customers with their mortgage needs.”