Virgin Money has announced a round of mortgage rate reductions, offering a glimmer of hope in a tough housing market. These cuts apply to both new purchases and remortgages, making it potentially cheaper for people to buy a home or secure a better deal on their existing mortgage.

What’s Changed?

For those looking to buy:

• Lower rates for high loan-to-value mortgages: If you’ve got a smaller deposit, you’ll be pleased to hear that rates on 85% and 90% LTV mortgages have been cut. For example, you could now get a five-year fixed rate at 85% LTV from 4.19%.
• Cheaper ‘Fix and Switch’ deals: These mortgages give you the security of a five-year fix but let you switch to a different deal after two years without penalty, and they’re now available from 4.70%.
• Help for first-time buyers: Shared ownership mortgages are now available from 4.12%, making it slightly easier to get on the property ladder.
• Cashback for energy-efficient homes: The ‘Retrofit Boost’ mortgage offers a 0.10% rate reduction and up to £15,000 cashback for those making energy-efficient improvements to their homes. This rate is now available at 4.44% for a five-year fix.

For those remortgaging:

• Cheaper ‘Fix and Switch’ options: Like the purchase deals, these offer flexibility and are now available from 4.75%.
• Lower rates for high LTV: If you’re remortgaging but don’t have loads of equity, 80% LTV rates now start from 4.41%.
• Retrofit Boost also available: The 4.44% rate and £15,000 cashback offer is also available for those remortgaging and making energy-efficient improvements.

What Does This Mean for You?

These cuts could mean significant savings for borrowers. However, it’s crucial to compare deals from different lenders to find the best rate for your circumstances. Speaking to a mortgage broker can be helpful, as they have access to a wider range of deals and can provide expert advice.