Virgin Money will soon pay brokers a procuration fee for retention business as part of a shakeup of its broker service.
The payment will come as part of a new Virgin Money online system that lets brokers compare consumer mortgage options at the retention stage.
Virgin Money mortgage director Peter Rogerson says the proc fee level has not been set yet but says “it won’t be an insult, it will be competitive”.
The system will launch in late June or early July to the 15,000 mortgage advisers registered with Virgin Money.
Rogerson says: “They will have access to content to help the customer make a considered decision if they’re better off going somewhere else or better off staying with us.”
Before, the lender had no such system to handle retention business or the associated proc fees.
Rogerson says: “We didn’t have a system to do that before, because we didn’t build our intermediary proposition, years and years ago, to assume that the intermediary would be part of the process.
“So if you think about how the market’s gone, 75 per cent of transactions are now being driven by intermediaries. Customers like that channel. So we felt it was important that customers have choice.”
Virgin Money currently controls around 3.5 per cent of gross lending, according to Rogerson.
He says: “We have aspirations to move from being a mid-size lender to being one of the top six. To do that we have to make it easier for intermediaries to do business with us.”
Virgin Money has also made an intermediary portal to give brokers one platform for information about Virgin Money.
Rogerson says: “They can go through the portal to get everything they need. We’re trying to make it easier for them, rather than them having to struggle to find the information or phone the BDM all the time.”
Two weeks ago Virgin Money launched a consumer advertising campaign to encourage more of them to use mortgage brokers.