Pepper Money has reduced rates and increased flexibility over fees in its mortgage range.
The specialist lender announced yesterday (April 17) that some rates would be cut by almost 1 per cent and customers would now have the option of a £0 completion fee.
Last November, Pepper simplified its criteria for borrowers with adverse credit and set up ‘tiers’ — ranging from Pepper 6 to Pepper 48 — depending on how recent the borrower’s county court judgements, mortgage or secured loan missed payments and arrears appeared on the client’s credit file.
The number on the policies reflect the time frame, in months, during which a client must have no defaults or arrears to qualify for the offer.
In its latest move the firm’s 'Pepper 24' five-year fixed rate options have been cut by 0.2 per cent.
Those with a 30 per cent deposit, and 24 months of clear credit history, can expect rates of 3.77 per cent while those looking for 85 per cent LTV options can get the five-year fixed at 4.38 per cent.
Rates on Pepper's buy-to-let range have also been reduced. Customers who fall into the 'Pepper 6' category can now get a 70 per cent LTV at 4.98 per cent — a 0.89 per cent reduction — while the rates on a 'Pepper 12' buy-to-let mortgage at 75 per cent LTV has dropped 0.8 per cent to 4.88 per cent.
Pepper has also cut the cost of valuation fees and reduced some valuations by £200.
Paul Adams, sales director at Pepper Money, said: "At Pepper Money, we constantly review our products to ensure they give brokers the tools they need to find a home for their interesting cases, and our latest changes give the duel benefit of greater choice with more simplicity.
'We have also lowered some upfront costs and introduced a new £0 completion fee option, which I know will be well received and is also ideal for clients who want to borrow up to the maximum LTV and would have otherwise had to add the fee to the loan.
"As well as this, we have cut the price on some of our products, including some five-year fixed rates, which are popular among clients looking for longer term certainty and to maximise their affordability."
Carl Shave, director of Just Mortgage Brokers, said: "Pepper have forged a very good reputation in the specialist lending sector and this revamp of their product range will see that cemented further.
"With the recent loss of Magellan Homeloans from the market it is a positive sign to see lenders such as Pepper Money strengthen their portfolio of products and give a show of confidence that it remains business as usual for them."
Specialist mortgage lender Magellan Homeloans closed to new business in March, stating it no longer wished to compete in an "unsustainable" market.
imogen.tew@ft.com
