Virgin Money’s mortgage lending rises ahead of 2022 Clydesdale and Yorkshire rebrand
The lender reported higher volumes of new lending for all three brands, which continue to operate separately, which it attributed to “buoyant market conditions” ahead of the stamp duty holiday deadline.
CYBG, the parent company of Clydesdale, acquired Virgin Money in October 2018 in a £1.7bn takeover, with Virgin Money emerging as the lead intermediary mortgage lending brand.
Virgin is optimistic about the UK economic outlook, citing stronger GDP growth, lower unemployment, robust housing market and increased consumer confidence as positive indicators of an improving outlook.
It added that whilst the number of Covid-19 cases was increasing, especially those with new variants, and the impending rollback of government schemes were concerning the “strengthening backdrop” gave it “greater optimism about the pace of recovery”.
Virgin Money’s chief executive officer David Duffy said: “While COVID continues to impact the near-term, we have a strong capital position and robust provisions. We see great opportunities from further developing our digital capabilities to deliver an improved customer experience and greater efficiencies. We are well placed to grow profitably next year as we play our role to support the UK economic recovery.”
The bank said it was continuing its digital strategy to improve customer experience and drive efficiency in the business. It reiterated that it would do this by increasing customer’s adoption of digital technology, improving flexibility of employee working arrangements and further automation.
In the third quarter the lender launched its first greener mortgage product, which is said it would “develop further” in the coming months.
Virgin Money said that it had made continued progress in reducing its cost base in the third quarter, and that it expected underlying operating expense of less that £890m for the full-year and £430m for the half year.
Virgin Money launched its 95 per cent mortgage guarantee scheme product in May and was one of the original lenders to sign up to the scheme outlined in the Budget.
Coventry cuts fixes by 10 bps and Clydesdale adds broker exclusive
The lender also launched a 95 per cent LTV two-year fixed rate mortgage at 3.65 per cent for purchase and product transfer.
The rate cuts included the two-year fixed rate purchase product at 85 per cent LTV, with a rate of 2.05 per cent, down from 2.15 per cent. The product is fixed and with early repayment charges (ERCs) to 30 September 2023, and has a £999 product fee.
The five-year fixed at 90 per cent LTV was reduced to 3.15 per cent, from 3.25 per cent, for purchase, remortgage, further advance and product transfer. It’s fixed to 30 September 2026, with ERCs to that date, and a £999 fee.
The newly launched two-year fixed at 95 per cent LTV has an end date of 30 September 2023, with ERCs and no fee.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society (pictured), said: “Our high LTV residential mortgages are now even more competitive, which is great news for brokers and their clients with smaller deposits. Whether brokers are looking to help their clients take that all-important first step onto the property ladder, or to support those looking to remortgage to a lower rate, there’s a competitive option for a wide range of clients in our owner-occupier range.
“And we now have a two-year fixed, no fee option at 95 per cent LTV, which is great news for brokers with clients looking to keep their upfront costs low.”
Clydesdale Bank rate cuts
Clydesdale added a new broker exclusive five-year fixed product at 90 per cent LTV, with a rate of 3.19 per cent and fee £1,999.
The lender also cut rates across its two and five-year fixed residential mortgages at 80 per cent and 85 per cent LTV.
The two-year fixed at 80 per cent LTV, with no fee, was cut to 2.23 per cent, down from 2.28 per cent. At 85 per cent LTV, the two-year fixed rate, with £999 fee, came down to 2.18 per cent from 2.41 per cent.
The five-year fixed at 80 per cent LTV, with £999 fee, was cut to 2.05 per cent, from 2.11 per cent. At 85 per cent LTV, the five-year fixed, with £999 fee, was reduced to 2.54 per cent, down from 2.64 per cent.
Additionally, rates were cut on the two and five-year fixed products for London and the South East, at 90 per cent LTV, with £999 fee. The two-year rate came down to 3.42 per cent, from 3.52 per cent. The five-year rate was cut to 3.66 per cent, from 3.76 per cent.
The two and five-year fixed rate products for professionals were reduced by up to 0.15 per cent.
Virgin unveils three new products and Clydesdale adds large loans deal
The new products include a two-year fixed rate mortgage in the lender’s purchase exclusive £1,000 cashback range, which comes with a rate of 1.28 per cent at 75 per cent loan to value (LTV), and a £1,495 fee.
There is also a new 80 per cent LTV option in the same range, fixed for two years at 1.93 per cent, with a £995 fee.
Additionally, the lender has cut rates on other two and five-year deals in the range, such as reducing the five-year fixed at 85 per cent LTV by 0.12 per cent to 2.58 per cent.
The other new product announcement was a three-year fixed-rate fee saver deal, with a rate of 3.64 per cent at 95 per cent LTV.
There were further rate cuts of around 0.2 per cent on the core residential range two and three-year fixed products, across the LTV range.
Virgin rate cuts across the range
Virgin’s Greener Mortgage range saw cuts of 0.2 per cent on the two-year fixes at 65 and 75 per cent LTV, both with a fee of £995.
At 85 per cent LTV, a two and a five-year fixed Greener Mortgage were reduced by 0.05 per cent, to 2.23 per cent and 2.53 per cent respectively, both with a £995 fee.
Buy to let (BTL), BTL portfolio and shared ownership mortgages also saw a slew of rate cuts across two and five-year deals.
Highlights included a 0.24 per cent cut on a five-year fixed BTL deal at 80 per cent LTV, giving a rate of 3.35 per cent, and a £995 fee.
In BTL portfolio, the five-year fixed at 60 per cent LTV was reduced by 0.21 per cent to 1.88 per cent, with a £1,999 fee.
Meanwhile rate cuts across the lender’s shared ownership range included a 0.44 per cent reduction on the two-year fee saver at 85 per cent LTV, to 2.99 per cent.
Clydesdale Bank adds new large loan deals
Clydesdale Bank has introduced new rates on loans of more than £1m and cut rates on other residential deals.
The new product offers a two and five-year fixed product with rates starting at 1.79 per cent, on loans of more than £1m, at 65 per cent LTV, with a £1,999 fee.
Rate were cut on some 80 and 85 per cent LTV, two and five-year fixed deals, by up to 0.11 per cent and 0.08 per cent respectively.
The rate on the lender’s professional and newly qualified professional two and five-year fixed products, at 85 per cent LTV, were reduced by up to 0.05 per cent.
Clydesdale Bank also said it would withdraw its exclusive two and five-year fixed rate deals at 90 per cent LTV, with a £1,999 fee.
Meanwhile, rates were increased by 0.1 per cent on the exclusive professional range, on two and five-year fixed deals at 90 per cent LTV.
The same rate increase applies to the London and South East two and five-year fixed deals at 90 per cent LTV.
Clydesdale removes 90 per cent LTV FTB product and cuts rates on 85 per cent LTVs
The product is the only first-time buyer product in its roster according to its website. The product has a rate of 2.89 per cent and a £1,999 fee.
The lender still offers seven 90 per cent LTV products, four of which are two-year products and three of which are five-year fixed products.
The lender also announced that it would be reducing rates on a range of 85 per cent LTV products, including its two and five-year fixed rate products with a £999 fee which will now start at 2.48 per cent.
According to its website, its current rate for its 85 per cent LTV product stands at 2.54 percent and its five-year product rate is 2.75 per cent.
Its two-year fixed rate fee offer product at 85 per cent LTV is also being reduced by 0.03 per cent to 2.78 per cent.
The lender has also cut rates for its two-year fixed rate 85 per cent LTV professional and newly qualified professional will be reduced and start from 2.65 per cent.
There are currently two, two-year fixed rate products aimed at professionals and newly qualified professionals, with rates standing at 2.76 per cent and 2.96 per cent respectively.
They are aimed at accountants, architects, barristers, chartered surveyors, dentists, engineers, financial advisers, medical doctors, nurses, optometrists, pharmacists, pilots, police officers, solicitors, teachers, vets.
Clydesdale Bank revises criteria and releases 90 per cent LTVs
The maximum mortgage term has risen to 35 years from 30, and the bank will now accept flats and maisonettes shorter than four storeys.
Properties must not be ex-local authority or ex-Ministry of Defence.
Across its 80 per cent LTVs, the bank has upped the maximum loan size from £750,000 to £1m.
Clydesdale Bank has also added a pair of 90 per cent LTVs to its range. The two-year fixed has a rate of 3.42 per cent and the five-year fix is set to 3.66 per cent. These products have fees of £999.
For these products, loan sizes vary between £540,000 and £750,000.
The bank has reduced rates on two and five-year fixes with a £999 fee at 75 per cent LTV with pricing starting from 1.32 per cent.
The five-year fixed fee-free alternative has been cut to 1.72 per cent.
Meanwhile, it has simplified the fee structure on all its capital and interest repayment mortgages for loan sizes up to £1m. All fee-paying options now have a standard fee of £999.
These changes are effective from today.
Clydesdale Bank adds 90 per cent LTV for first-time buyers
There is now a 90 per cent loan to value (LTV) two-year fixed product for those getting on to the property ladder. This has a rate of 2.89 per cent and a £1,999 fee. It also includes a free valuation.
A two-year fix at 90 per cent LTV for all borrowers has also had its rate reduced to 2.95 per cent. This also has a £1,999 fee.
Elsewhere, the bank has withdrawn a two-year fixed at 75 per cent LTV as well as a two-year discounted product with a rate of 1.74 per cent.
Clydesdale Bank has also updated the way it accepts product fees due to broker feedback. It now allows fees to be added to the total mortgage loan as long as it does not take a residential loan over 95 per cent LTV and a buy-to-let loan over 80 per cent LTV.
These changes came into effect today.
Clydesdale adds 90 per cent LTV exclusives and Vida slashes rates up to 95bps
The 90 per cent LTV exclusives are applied to two and five-year fixes with rates starting from 2.99 per cent. The deals have a £1,999 fee and come with a free valuation.
Clydesdale has also reduced rates on its professional and newly-qualified professional range at 85 per cent and 90 per cent LTV by up to 0.12 per cent, with these products now starting from 2.76 per cent.
For mainstream borrowing, the 85 per cent LTV two and five-year fixed rates have been reduced by up to 0.14 per cent, the 80 per cent LTV full capital and interest five-year fixes trimmed by up to 0.10 per cent and the 75 per cent LTV two and five-year fixes reduced by up to 0.12 per cent.
Vida slashes rates
Vida Homeloans has cut interest rates on its residential mortgage products by up to 95 basis points (bps), with cuts to rates on its specialist buy-to-let offering as well.
Reductions apply to the Vida 1, 2 and 3 core residential purchase and remortgage ranges and the lender said the cuts made its “prices some of the most competitive in the specialist market”.
The biggest cut of 95bps has been made to its Vida 1 five-year fix at 80 per cent loan to value (LTV) which now has a rate of 3.94 per cent.
The Vida 1 residential range also saw several other significant rate cuts, including the 75 per cent LTV two-year and five-year deals cut by 74bps and 65bps respectively to 3.18 per cent and 3.54 per cent.
Other changes to Vida’s residential offering include rates on all products in the Vida 2 range cut by up to 40bps and rates on all products in the Vida 3 range cut by up to 25bps.
Its Vida 1 buy-to-let houses in multiple occupation and multi-unit freehold block (HMO/MUB) range has also seen rates trimmed by 20bps at both 70 per cent LTV and 75 per cent LTV.
Earlier this week, Vida announced the managing director of mortgages Louisa Sedgwick was leaving with Richard Tugwell appointed as director of mortgage distribution.
Commenting on the rate cuts, Tugwell said: “A strong specialist lending sector that offers competitive rates and innovative solutions has never been more important and these rate cuts are just one step towards achieving this.
“Vida is wholly committed to making continuous refinements to its products and services, so that intermediaries and customers have access to the financial solutions they need to achieve home ownership.”
Vida CEO Anth Mooney added that Vida had learned a lot over the past 12 months.
“We now have the opportunity to improve our competitive position and focus on supporting those underserved borrowers whose circumstances have been exacerbated by the Covid-19 pandemic,” he said.
“We have invested in new processes, streamlined the way we underwrite, reduced the documentation requirements for intermediaries and recruited new experienced underwriting resources to ensure that our new business capacity is significantly expanded.”
Newcastle Building Society
Meanwhile, Newcastle Building Society has added a pair of 85 per cent LTV products for first-time buyers, re-mortgagers and home movers.
The £999 fee version is available at 2.7 per cent with the fee-free deal at 2.8 per cent – both have free valuation and include two years early repayment charges.
John Truswell, head of intermediary mortgages at Newcastle Building Society, said: “We’re always looking at the changing needs of the market and have evolved our proposition to suit brokers and their clients.
“These new 85 per cent products will support a variety of borrowers including first-time buyers, home movers and existing home owners looking to remortgage.”
Mortgage brokers adapt to pandemic as fewer fear damage to business
The proportion of brokers who say the pandemic is having a significant impact on their businesses has fallen from 54 per cent to 44 per cent, while almost a fifth say they don’t expect the health crisis to make any difference to them at all.
Brokers say they are still facing many challenges, however.
Half of those surveyed say the main obstacle they face is lenders changing their criteria, followed by poor service levels and banks tightening their policies. Only three per cent of brokers said Brexit posed any challenge to their businesses this year.
Some 26 per cent of brokers said the availability of higher loan to value (LTV) products was a major obstacle.
Mortgage interest rates are expected to remain largely the same this year, according to 55 per cent of those surveyed and 60 per cent expect remortgages to make up the majority of their business in 2021 as demand for new houses cools.
To support brokers, Virgin Money has set up a business development team that can answer questions on the products and services of both Virgin and Clydesdale Bank brands.
Sarah Green, head of mortgage distribution and general insurance at Virgin Money, said: “The challenges faced by brokers as they navigate these unprecedented times are consistent with those reported in our survey from October and emphasise how essential it is we deliver on the needs of intermediaries.
“This is a key reason for us recently launching a dual-branded BDM team, so brokers can have direct access to a team when working on a transaction. We’re also excited to be part of the mortgage guarantee scheme for first-time buyers as we recognise how essential it is for them to get on the ladder and hope this will also help brokers working with that segment of the mortgage market. Our aim is to provide as much support as possible for brokers, buyers and sellers alike as the industry navigates through the challenging times ahead.”
Chancellor Rishi Sunak announced in the Budget earlier this month that the government would back a mortgage guarantee scheme that would encourage lenders to offer 95 per cent LTV mortgages. The UK’s five biggest banks have signed up and are expected to launch products in mid-April. Virgin Money will join the scheme in May.
Virgin and Clydesdale combine restructured BDM teams and add 90 per cent LTV deals
The move is part of the integration of the lenders under the Virgin Money brand after their merger in 2019.
The lenders said there had been some territory changes and admitted the team size had remained “largely unchanged” but did not give details of how many BDM positions had been affected or how big the team is now.
The new team will offer brokers support and advice across the full range of products and services including residential and buy-to-let mortgages at both banks.
“The key difference is that every BDM is able to support with both brands, so some brokers will already have a good relationship with their BDM as they dealt with them previously on a single brand,” a spokesman told Mortgage Solutions.
“In many occurrences, the broker will benefit from having more support as they will get a field and a telephony BDM supporting on both products rather just one previously.”
Sarah Green, head of mortgage distribution and general insurance at Virgin Money (pictured), added: “This is another important step in our journey to combine Virgin Money and Clydesdale Bank.
“The new team have a combined wealth of experience and will help brokers find the right product for their customers.
“As well as having access to a full range of Virgin Money and Clydesdale Bank products, brokers will be able to chat directly to their BDM about complex cases which may require a more flexible and bespoke approach to underwriting complex cases, something which Clydesdale Bank is widely known for.”
New products for professionals
Clydesdale Bank has also made changes to its product offering – cutting rates and introducing a pair of 90 per cent loan to value (LTV) deals for professionals.
The new 90 per cent LTV professional deals are available for purchase and remortgage, up to a maximum loan size of £750,000 in London and £450,000 throughout the rest of the UK, with a maximum term of 30 years.
These deals are not available for flats or maisonettes and new build purchases.
The two-year fix is at 3.44 per cent and the five-year version at 3.64 per cent.
Seven other products have seen interest rates cut by 10 basis points (bps), including the two-year fixed fee offer deal at 85 per cent LTV which is now at 2.89 per cent.
The reciprocal options for professionals and newly qualified professionals have also been reduced to 2.85 per cent and 3.05 per cent respectively.
Green added: “We’ve reduced rates across our Clydesdale Bank mortgages. We keep our rates under review and these latest changes demonstrate our support for first time buyers as well as anyone looking to move house or remortgage.”
Clydesdale Bank makes rate changes and expands 85 per cent LTV range
A two-year fixed with a rate of 2.69 per cent and fees of either £999 for loans of over £500,000 or £1,499 for loans over £1m has been introduced for borrowers with a 15 per cent deposit. This mortgage will be available from 8 January.
Also from tomorrow, the rates of mortgages available to new customers will be cut by up to 15 basis points.
This includes a two-year fixed at 75 per cent LTV which has gone down from 1.89 per cent to 1.79, as well as a two-year fixed at 85 per cent which has been reduced from 3.11 per cent to 3.04 per cent.
Meanwhile, products for existing borrowers with low equity have increased by 40 basis points.
The two-year fixed at 90 per cent LTV with a £1,499 fee has gone up to 2.99 per cent and the £999 fee option has increased to 2.79 per cent.
The 85 per cent LTV mortgage for existing customers with either a £999 or £1,499 fee has risen from 2.29 per cent to 2.69 per cent.
The products with lower fees apply to borrowers requiring loans of £500,000 and over, while the higher fee products apply to those who require loans of £1m and above.