How Virgin Money is building loyalty through competitive home loans

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on November 18, 2021 Fact Checked
How Virgin Money is building loyalty through competitive home loans

Virgin Money home loans was born out of a vision to simplify banking and the home loan process - find out how it’s doing that in this review.

You might best know the ‘Virgin’ brand for its competitive airline and velocity rewards program, but Virgin Money is quite different. For one, it is 100% owned by Bank of Queensland (BoQ), which is one of Australia’s largest challenger banks. Virgin Money has also amassed a home loan portfolio in excess of $4.5 billion.

Besides home loans, Virgin Money also offers credit cards, superannuation and insurance. In April 2021 it also announced the launch of its savings accounts and a transaction account.

What home loans does Virgin Money offer?

Virgin Money offers a variety of variable and fixed-rate home loans for owner occupiers and investors across a range of loan-to-value ratios (LVR) from less than 60%, up to 80%, 80 to 90%, and over 90% on principal and interest P&I) payments.. It also offers construction loans if you are looking at building your own home. For those opting to pay interest-only (IO), the maximum LVR is usually 90%, meaning you must have at least a 10% deposit.

Here’s a snapshot of Virgin Money’s home loans for owner occupiers:

Lender
Advertised rate Comparison rate Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

FixedMore details

Reward Me Home Loan Fixed 2 Years ($300k+) (Principal & Interest) (New Customer)

VariableMore details

Reward Me Home Loan (Principal and Interest) ($75k-$500k, LVR < 80%)

FixedMore details

Reward Me Home Loan Fixed 3 Years ($300k+) (Principal & Interest) (New Customer)

FixedMore details

Reward Me Home Loan Fixed ($300k+) (Principal and Interest) 2 Years

FixedMore details

Reward Me Home Loan Fixed 3 Years ($300k+) (Principal & Interest) (New Customer) (LVR < 60%)

VariableMore details

Reward Me Investment Loan (Principal and Interest) ($75k-$500k, LVR < 60%)

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. Rates correct as of November 27, 2021. View disclaimer.

See how Virgin Money home loans compare with some of the most competitive home loans on the market for owner occupiers:

Lender
Advertised rate Comparison rate Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only)

  • Refinance only. Fast online application
  • No Nano fees. Free 100% offset sub account
  • Mobile app, Visa debit card & instant payments
REFINANCE IN MINUTES, NOT WEEKS

Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only)

  • Refinance only. Fast online application
  • No Nano fees. Free 100% offset sub account
  • Mobile app, Visa debit card & instant payments
VariableMore details
NO UPFRONT OR ONGOING FEES

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
NO UPFRONT OR ONGOING FEES

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees

Rates correct as of November 27, 2021. View disclaimer.

What sets Virgin Money apart from the big banks?

Savings.com.au spoke with Virgin Money Australia CEO Greg Boyle (pictured below) to find out what makes the lender distinct.

“We knew that people were finding the everyday necessity of banking over complicated and we had a clear vision to simplify banking, reward customers and help them achieve their financial goals,” Mr Boyle said.

VMABoyle.jpg

Virgin Money Australia's CEO, Greg Boyle. Image supplied.

Virgin Money home loan features

Key features

  • Offset Account: The ‘Reward Me’ home loan product line comes with a ‘Home Loan Companion’ account used to offset your loan balance and interest payable. This is available on the brand’s variable home loans.

  • Redraw Facility: If you’re ahead on your minimum repayments, you can redraw those funds at any time at no extra charge, with a minimum redraw amount of $100.

  • Split Borrowings: You can split your home loan across both variable and fixed interest rates, which may provide a good mix of flexibility and certainty.

  • Choice of Payment Frequency: If you’re making P&I payments, you can choose monthly, fortnightly, or even weekly payments. IO payments can only be made monthly. Fortnightly payments could reduce the interest paid over the life of the loan, as you have an extra payment period every year as opposed to monthly payments.

  • Extra Repayments on Fixed Loans: Borrowers can repay an extra $10,000 per year on fixed loans

  • Rate Lock: Allows customers to lock in an applicable interest rate for up to 100 days and helps protect them from any potential rate increases.

“Whether you’re buying your first home, investing or looking to save interest, we offer the perfect combination of award-winner home loans and competitive rates,” Mr Boyle said.

“We discount our interest rate based on the loan size and loan-to-value ratio, as well as 100% offset account and online redraw at no extra cost.”

Cashback offer

Virgin Money currently has an ongoing $3,000 refinance cashback offer, and a $2,000 property seller cashback for existing customers looking to upgrade, downsize, or those who are simply looking for a sea or tree change who take out their new home loan with Virgin Money.

Virgin Money app

“We developed a fully integrated digital experience, bringing together credit cards, transaction and savings accounts, as well as a loyalty program, in a single, native mobile app, which has a focus on helping Australians understand their money habits better,” Mr Boyle said.

Customers can improve their financial fitness and achieve their savings goals with some of the following features:

  • An auto spend categorisation to help see where your spending goes

  • Tag specific purchases so you can track how much you spend: “For example, if you eat out for lunch or love buying your coffee, you can tag these purchases and see how much you are actually spending on these items and if there are opportunities to cut back and save here,” Mr Boyle said.

  • Round up your purchases to the nearest dollar and send the change into your preferred linked savings account

  • Set up to nine personalised savings goals

Virgin Money Rewards loyalty program

Customers with a Virgin Money Go Account will earn Virgin Money Points on everyday purchases if meeting the monthly criteria, and can choose to use those points to redeem for cash back into their linked transaction or savings account .

“We had a unique opportunity to build something meaningful and that’s where the Virgin Money Rewards program was born – a genuine loyalty program that continually rewards and recognises customers throughout the lifetime of their relationship with us,” Mr Boyle said.

“Our research also told us that rewards are important to customers and they didn’t feel valued or recognised for their loyalty to their financial institution.

“While traditionally customers are familiar with earning points on their credit cards, we reward customers for their everyday spending on their debit card – whether you’re grabbing a coffee, purchasing a new t-shirt or paying your bills, we’ll reward you for every purchase direct debit or BPAY payment you make.”

The Virgin Money Rewards partnership program currently has more than 100 earn and redemption partners, with the number of partners regularly expanded. Customers are able to earn thousands of points from some of their favourite brands including the Iconic, Menulog and Adore Beauty.

What’s next for Virgin Money Australia?

“The digital bank has a clear focus on rewarding customers for good behaviours, financial fitness and achieving their own financial goals, and we’ll continue to review our customer feedback to make sure they have the best platform and tools to do this,” Mr Boyle said.

“In 2022 we’ll be making some exciting changes to our home loan and credit card products, including the option for customers with these products to be able to earn Virgin Money Points and extension of our new digital banking platform to include home loans.

“We’ll also be launching more exciting ways for customers to earn and redeem points.”

How to apply for an Virgin Money home loan

Eligibility criteria

Virgin Money has a few requirements you must meet in order to qualify for any of its home loans, including:

  • You must be 18 years of age or over

  • You must be an Australian citizen or permanent resident

  • You must have a regular source of income

  • You must be an individual applicant (no trusts or companies)

Documents needed

  • Photo ID - Drivers Licence or Passport.

  • Birth Certificate, Debit Card, Credit Card, or Medicare Card.

  • 2 most recent payslips, or last 3 full consecutive months' bank statements showing regular salary credits with name of employer evident.

  • If refinancing: Refinancing statement of existing loan account, details of all costs and fees relating to payout figures or fees, plus copy of current home insurance policy.

  • If purchasing property: Copy of contract of sale, details of solicitor/conveyancer, proof of deposit for property


Hero image supplied

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

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Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.

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