Virgin Money loan holders cry ‘foul’ over proprietor Nationwide’s greater offers

Some Virgin Money shoppers are crying “foul” over the truth that Nationwide debtors are being presented better-value loan offers, even if they’re now a part of the similar staff.

Nationwide purchased Virgin Money remaining autumn, however the manufacturers stay separate and a few Virgin mortgage-holders declare that on the subject of transferring directly to a brand new deal, they’re being handled as second-class voters.

This week, a Virgin buyer aiming to get a brand new loan deal from the lender would in some circumstances need to pay virtually £1,000 greater than an identical Nationwide buyer to get the similar rate of interest, even if they’re each a part of the similar monetary “family”.

However, consistent with one loan dealer, it’s same old observe {that a} borrower isn’t ready to hop from one logo to some other the place each are a part of the similar staff.

For the United Kingdom as an entire and throughout all lenders, about 1.6m fixed-rate loan offers are because of expire in 2025. Many of those individuals are apprehensive about a large leap in bills after they transfer to a brand new product.

When any individual’s present loan deal is achieving its expiry date, their lender will in most cases be involved providing a choice of charges.

Nationwide finished its takeover of Virgin Money remaining October, and later published it had bagged a £2.3bn acquire from the deal because it had successfully purchased the logo at a corpulent bargain.

That in flip resulted in Nationwide shelling out £50 mini-windfalls to greater than 12 million of its participants remaining month – greater than £600m in overall.

However the 2 manufacturers proceed to function as separate lenders and be offering otherwise priced loan offers to their respective buyer bases.

Borrowers who’ve reached the tip in their handle one can’t merely transfer to the opposite – they must cross throughout the means of remortgaging and pay any criminal and valuation prices concerned.

The Guardian was once contacted this week by means of a Virgin Money buyer on a two-year repair with a price of 4.54%, which results on 31 July. The lowest product switch price being presented to her was once some other two-year repair priced at 3.84%, which is a aggressive price (her loan-to-value ratio is not up to 60%).

But this deal got here with a large product charge: £1,995.

Now she is a Nationwide staff buyer, she was hoping to peer what product switch charges had been being presented to Nationwide shoppers with the same quantity of fairness. Nationwide was once additionally providing a 3.84% two-year repair to its present debtors – however at £999, the product charge was once virtually £1,000 decrease.

Virgin additionally presented a number of base-rate tracker offers, together with a two-year one at 4.48% (the financial institution base price plus 0.23%) and a £995 charge.

But an Nationwide borrower may just get pleasure from a reasonably inexpensive deal: a two-year tracker at 4.39% (the bottom price plus 0.14%) and a £999 charge.

Another good thing about the Nationwide tracker is that it has no early compensation fees, while the Virgin one does all over the 2 years. However, Virgin will let shoppers transfer from this deal directly to considered one of its constant charges with no need to pay a penalty.

A Nationwide spokesperson says: “Nationwide building society and Virgin Money continue to operate as separate lenders following the acquisition and are being integrated over time.”

They upload: “Customers currently wishing to move provider must therefore do so as a remortgage.”

David Hollingworth on the dealer company L&C Mortgages says it’s “pretty typical that you wouldn’t be able to switch between one brand and another”.

For instance, Lloyds and Halifax are each a part of Lloyds Banking Group however will worth otherwise, he says. Meanwhile, The Co-operative Bank was once not too long ago taken over by means of Coventry development society, however nonetheless operates as separate lending logo.

On whether or not Nationwide usually presented greater offers than Virgin, or vice versa, Hollingworth says that “it moves around” and that they’re each in most cases lovely aggressive. “Virgin is just as likely to be right up there as Nationwide can be,” he says.