"We have a more rounded, informed and empathetic view so that, whatever the situation of your customers, it’ll always be a familiar one to us."
With this in mind, we have undertaken a large piece of work to gain a deeper understanding of our customers, and your customers, so that we’re better equipped to help them fulfil their ambitions. Connecting the right people with the right products is our goal, whatever the situation of your customers, it’ll always be a familiar one to Pepper Money. Greater customer insight means that we’re better equipped to help them fulfil their ambitions - whatever these may be.
Our understanding goes beyond the basic, to get to the bigger picture regarding their occupations, family and lifestyle, interests and aspirations. It means that we have a more rounded, informed and empathetic view so that, whatever the situation of your customers, it’ll always be a familiar one to us.
We have worked with a business consultancy firm, CACI, on analysing its ACORN demographics to identify the four most typical types of Pepper Money customers. These will be the types of customers you encounter every day. So, who are they? What are their characteristics? And how can we help?
Affluent Borrowers
You might be surprised to learn that nearly a quarter (22%) of applications to Pepper Money are from customers that have a household income above UK and London averages, and an important segment of our customers are affluent borrowers.
These are successful, older families, with high incomes and larger homes. Often, they might be exploring a second charge mortgage, and they also have an interest in property investments and holiday homes.
At Pepper Money, our mortgage range is ideal for affluent borrowers with no CCJs or defaults in the last four or more years and requires a specialist mortgage solution. The maximum LTV on our mortgages is up to 85%, we don’t impose a maximum debt-to-income ratio and we allow capital raising without restriction on the LTV. Affluent borrowers could also take advantage of the fact we can also consider earned income up to the age of 75 and include bonus and commission income.
Other criteria that can be attractive to your affluent borrowers could be the ability to release equity for gifted deposits, and the option to borrow up to 60% LTV to help with downsizing. Our mortgages can also be used for Let to Buy.
Almost Primers
The next group of customers is a group we call almost primers – people who may have had credit issues in the past, but whose finances have stabilised more recently. This group tends to be homeowning families, who are often middle aged and working in middle management. The course of their lives means that their finances may have previously been stretched, but they are now living much more comfortably.
At Pepper Money, 63% of all completions on our nearer almost primer Pepper mortgages don’t have any CCJs or defaults.
The reasons an almost primer might choose Pepper are for criteria that mean unsecured credit won’t affect the product tier and missed payments can be accepted. We also lend up to 85% LTV and allow debt consolidation up to maximum LTVs. In addition, Universal Credit and Disability Living allowance are now accepted as sources of income.
Comfortable Consolidators
Comfortable consolidators are settled families, who own average-value homes. They have the potential to afford a higher value mortgage and unconsolidated, but managed debt. For these customers, it can be challenging for busy people to get the full picture of their finances. Therefore, consolidating their debt into one single monthly payment, can put them back – and keep them – in their financial comfort zone.
Interestingly, of all Pepper’s completions year to date, more than 40% have no CCJs or defaults on their credit record.
Your comfortable consolidators customers may be seeking mortgage options to consolidate debts. Therefore, the fact we allow up to maximum LTVs and have no maximum debt-to-income ratios could be attractive. Furthermore, unsecured credit won’t affect the product tier and our use of AVMs means that we are able to complete cases quickly. In addition, for your self-employed customers, we can accept one year’s trading, and we are also able to consider commission and bonus payments, Universal Credit and Disability Living Allowance as sources of income.
Recent Recoverers
Last but not least are the recent recoverers, a group of customers with recent incidents of adverse credit who are bouncing back from past decisions. Both broker and lender will need to help provide a clear, achievable roadmap to financial recovery. Often, they are younger families, with more modest incomes and smaller homes, and typically they might be second jobbers, or working in NHS, civil service, or similar roles.
Your recent recoverers customers Pepper 18, Pepper 12 and Pepper 6 could all be good solutions. Lending criteria that can benefit this group of customers include no values limits on CCJs and defaults, which do not need to be satisfied. We also allow customers in a performing Debt Management Plan and have a bankruptcy range available. We don’t rely on credit scoring to make decisions and we can consider incomes including Universal Credit, Childcare income, commission and bonus income.
