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Virgin Money Home Loans

Virgin Money, also known as Virgin Home Loans is very different to most banks because – well they aren’t a bank!

While the Virgin Money brand was started by Sir Richard Branson over 24 years ago, in recent years BOQ has bought the rights to distribute Credit Cards, Home Loans, Superannuation and various insurance products across Australia.

So does Virgin Money offer the same glitz and glamorous service we have come to expect from the Virgin Brand?

Today I review Virgin Money Home Loans and put them through their paces.

Virgin Money Home Loans

Note this review, interest rates and product information is correct as at 23 May 2019 and all of this information is subject to change without any further notification. Any applications for credit are subject to meeting the specific bank’s criteria and the decision is at their final discretion.

 

What are Virgin Home Loans like?

The top 5 things Virgin Money are good at:

  • Low Deposit Home Loans: Virgin Money are one of the few home loan providers who will allow lending up to 95% PLUS Lenders Mortgage Insurance. In other words, they will consider lending to first home owners with a 5% deposit.
  • Frequent Flyer Points: Being affiliated with an airline does come with some perks, loans with Virgin Money generally attract Virgin Velocity points on settlement, and sometimes ongoing while you have the loan open.
  • Good for multiple units on one title: If you’re looking at buying properties with multiple units on one title, for example an older style block of flats with up to 6 units on the one title – Virgin will look at lending up to 65% LVR.
  • Cash Out: Their credit policy is pretty flexible when it comes to getting cash out against your existing property, they do not require any documentation to substantiate what you need the funds for up to $50,000 on personal use, or $100,000 for investment purposes.
  • Non Genuine Savings: These guys are pretty loose when it comes to genuine savings (deposit savings that you’ve held for over 3 months). They will consider non-genuine savings, or gifted funds on purchases with as little as 5% deposit.

virgin money frequent flyer points

 

The top 5 things Virgin Money aren’t so good at:

  • ⛔️ Strict Credit Criteria: Being owned by BOQ (and having less tolerance for risk than the bigger banks), applications with Virgin Money are scrutinised in much more detail than other larger institutions. For example, if you are buying an investment property and will continue renting, Virgin want to see your current rental agreement to confirm the amount.
  • ⛔️ Slower Turn Home Loan Approvals: As Virgin Money will sometimes offer really good interest rates throughout the year it can cause a massive influx of home loan applications, causing their credit and processing teams to slow down. In the past, this has caused internal processing issues and it can take weeks for home loans in QLD to get approved.
  • ⛔️ Properties that are unique: Virgin Money has much more strict criteria around properties in mining towns, high-density apartments and units and other unique types of properties. For example, there are limitations in the maximum lending limits if you are buying an apartment in Brisbane (postcode 4000), Newstead (postcode 4007) or Teneriffe (postcode 4005) in Queensland.
  • ⛔️ People with bad credit: Virgin Money Home Loans aren’t able to help people with bad credit, like discharged bankrupts due to their credit policy. Under 80% of the properties value, they might consider a lower credit score on a case by case basis.
  • ⛔️  No Electronic ValuationsLarger banks are adopting the use of electronic valuations, otherwise known as AVM’s or RP Data reports which can speed up the refinance process. Virgin still require full valuations to be completed on applications with an LVR above 80% which can slow things down.

 

What are the different home loan products they offer?

Virgin Home Loans offers a limited range of mortgage products, and their most popular include.

Virgin_Money_Home_Loans

1. Reward Me Home Loan Variable 

Almost like a hybrid between a traditional professional package home loan, and a basic home loan the Virgin Reward Me Home Loan comes with a few interesting perks – especially for first home buyers, including:

virgin money home loans variable rate

  • ✅ Interest rate specials
  • ✅ Up to 20% discount on Lenders Mortgage Insurance
  • ✅ Waived settlement fees, saving you $150
  • ✅ And bonus Velocity Frequent Flyer points – you get 20,000 points per $100,000 at settlement
  • ✅ 100% interest offset account

There are some downsides to the package

  • ⛔️ Interest rates aren’t the best in the market
  • ⛔️ Tougher credit criteria making it harder for home buyers to get their loan approved
  • ⛔️ Credit Card fee isn’t included in the overall package.
  • ⛔️ $10 per month fee, and $300 switching fee
  • ⛔️ Not available for the purchase of land, or construction

If you are a frequent flyer points junkie, this could be a good one for you.

Virgin Money Reward me home loan points

 

2. Virgin Money Construction Loan

The Virgin Money Construction loan is like most banks building, or construction loans and allows you to:

  • ✅ Construct a home on land that you already own
  • ✅ Buy some vacant land and build a house on – otherwise known as a home and land package.
  • ✅ Complete some major renovations on your place, like a new kitchen or extension.

Now there are some limitations to their construction loans, including:

  • ⛔️ Work needs to be completed by a licensed builder
  • ⛔️ You cannot complete major renovations on an investment property
  • ⛔️ Funds are to be drawn progressively via a progress payment schedule – so you can’t get the funds in one big chunk of cash.

Download: Virgin Money Construction Loan Guide and read more on How Construction Finance works?

 

What are Virginmoney’s Interest Rates?

Virgin Money’s home loan interest rates is fairly competitive when compared to the big 4 banks. They can be hyper-competitive depending on the time of the year, and in recent times have had market-leading interest rates.

From time to time Virgin offers special interest rates to mortgage brokers, they are based on different criteria including the loan to value ratio and type of property with lower rates if you are buying or refinancing a home that you live in (often referred to as owner-occupied).

What are Virginmoney's Interest Rates

 

What documents does Virgin Money need for a home loan?

Virgin Money’s application checklist is fairly standard compared to most lenders, assuming you are a salaried employee and you are purchasing your first home they would ask for:

  • ☑️ Signed Application Form, Privacy Act form completed by all borrowers
  • ☑️ Identification documents: Current Medicare + Drivers license, or Australian passport
  • ☑️ 3 Months Bank statements showing your salary credits with the name of your employer
  • ☑️ 2 Most Recent Computer Generated Payslips
  • ☑️ Evidence of your Genuine Savings, being statements to show the funds have been held for more than 3 months
  • ☑️ Most recent statement showing all continuing liabilities – i.e. any open credit card, personal loan, or overdraft statements.
  • ☑️ Signed Contract of Sale

Where they are a bit different from some of the bigger lenders are requiring more information if you are in casual employment, contract employment or if you receive bonuses and commission. You can download their checklist from here.

 

How much can I borrow from Virgin?

Virgin Money’s credit criteria are subject to change at any time, and all lending is up to credit verification and satisfactory approval but as an indication, we have run the following scenario through their borrowing calculator:

  • ✅ A single person living in Brisbane (In the 4000 postcode)
  • ✅ Earning $70,000 PAYG salary income
  • ✅ Average monthly expenses of $2,000
  • ✅ Has a credit card of $5,000 and no other debts
  • ✅ Assuming this person has a 20% deposit as genuine savings
  • Figures as at 23 May 2019, subject to credit criteria and will change without notification.

We run the figures through our serviceability calculator and got the following results:

virgin money home loans how much can i borrow

As you can see from the results, Virgin Money is at the upper end of providing borrowing capacity when compared to the list of other lenders and around $53,000 higher with a borrowing capacity of up to $348,150.

These figures are indicative and would be subject to meeting credit criteria, valuation and satisfactory verification of all supporting documentation. They are accurate as at 23 May 2019 and subject to change without any further notification.

Would you like to know your borrowing capacity? Chat with our home loan experts to see what you can afford.

 

What else does Virgin Money Offer?

Not being a bank has some downsides in that they do not have branches, and support is all via phone and online.

Which works well for some people, and can be frustrating for others.

Virgin Home loans

The Virgin Money team also offer savings accounts, credit cards, home and other insurances so they have most of your products covered if you want everything in one place.

But, before taking the deep dive with Virgin, I’d suggest reading up a few online reviews…

 

What are some Virgin Customer Reviews?

Virgin Money’s customer reviews online can be fairly mixed, so do your research before you start signing the forms.

Virgin Money Home loan review (1)

 

How does Virgin compare to other banks?

Overall each Lender, Bank, and Credit Union has its own advantages and disadvantages which will come down to your personal situation.

Talk to one of our mortgage brokers calling us on 1300 088 065 or complete our free assessment to find out more details and see if Bank of Queensland is a good fit for you.

Ready to take the next step toward buying? We’re happy to help. Schedule a call today with a Home Loan Expert from Hunter Galloway, the home of home buyers.

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