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Virgin set for mortgage return

Virgin Money is planning to re-enter the UK mortgage market.

The company is expected to market its mortgages direct to consumers and target the same, younger demographic it does with all other Virgin Money products.

Virgin first launched onto the mortgage market in 1998 with the Virgin One account, which combined a current account with a mortgage, but since Virgin One was bought out by Royal Bank of Scotland in 2001, the company has had no presence in the market.

ING launched a directly sold mortgage last year which has proved to be an agg-ressive competitor to intermediaries.

Virgin Money spokesman John Franklin says: “We have been looking tentatively at re-entry to the mortgage market since the sale of The One Account but are happy to be patient until we can find the right proposition for customers and partners for such a venture.”

John Charcol senior technical director Ray Boulger says: “I hope that Virgin Money would offer the product through intermediaries as well as direct but their business model is direct.

“Lenders which deal direct need a big branch network, some market-leading, competitive products or to spend a lot of money on advertising. If they do not sell through intermediaries, they do not have the same discipline of having to be competitive all the time.”

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