The term "virgin mortgage" is an alternate term used for a mortgage taken out with no existing home loan debt. This type of mortgage can provide a number of significant benefits to borrowers, including the potential to save money and increase property value.

First of all, a good credit score is essential to obtaining the most competitively priced mortgages. With no existing mortgage debt, a borrower will usually have a higher credit score, which will give them access to attractive interest rates when they shop around for a mortgage. A borrower with a good credit score may also be given a larger loan amount than someone with an existing mortgage.

Additionally, with a virgin mortgage, a borrower can avoid the expensive transaction costs associated with remortgaging. Fees such as legal costs, arrangement and exit costs and surveys can add up to thousands of pounds – all of which can be avoided with a virgin mortgage.

Many lenders also offer attractive incentives to virgin mortgage customers. For example, some offer cashback or a percentage of the loan amount back in cash, making it an even more attractive proposition.

A virgin mortgage can also be beneficial for borrowers who want to increase the value of their property. A mortgage freed of the burden of existing debt can be used for developments or improvements that add value to the property. This could be anything from decorating or renovations to adding an extension. In the long term, this can offer a much higher return on investment than simply paying off the outstanding balance of an existing mortgage.

Finally, taking out a virgin mortgage can give borrowers the chance to start afresh. With no existing debts, borrowers can choose a new mortgage provider and take advantage of the range of mortgages on the market, rather than remaining with their existing, possibly outdated, mortgage. This can mean switching to a mortgage with more attractive terms, such as a better rate or more favourable repayment plans.

In summary, taking out a virgin mortgage can be an advantageous decision for borrowers who want to take advantage of better rates and incentives, reduce transaction costs and increase the value of their property.