Pepper cuts 90% LTV rates by up to 0.80% and launches new 'dual-rate' product

Pepper Money has announced a package of rate reductions across its residential and buy-to-let ranges.

The changes include cuts of up to 0.80% on Pepper 48 and Pepper 48 Light two-year products. Two-year rates at 90% LTV have been reduced by 0.80% on both products, moving to 6.99% and 6.94% respectively.

There are also cuts across the five-year range, with reductions of up to 0.32% on Pepper 48 and Pepper 48 Light at 90% LTV.

The changes are aimed at customers who fall just outside high-street criteria and are working towards repairing their credit before returning to the mainstream market.

Following the rate cuts, residential rates now start from 5.75% and buy-to-let rates from 4.64%.

Alongside the core range reductions, Pepper has launched a limited edition two-year fixed product with a dual-rate structure, designed to give brokers greater flexibility when working through affordability.

The product offers two options: one with a lower initial rate and a higher reversion rate, which maximises borrowing power at the point of application; and one with a higher initial rate and a lower reversion rate, which reduces the ongoing cost once the fixed period ends. Both sit to either side of the core range reversion rate.

Pepper has also reduced rates across its buy-to-let and limited company buy-to-let ranges, with rates now starting from 4.64%, marking a further step in the lender's re-entry into the buy-to-let space.

Paul Adams, sales director at Pepper Money, commented: “Affordability is still one of the biggest challenges brokers are navigating for their customers, especially when rates are moving as quickly as they have been.

“Often, two-year affordability can be difficult to make work. But at the same time, a lot of customers don't want to lock in for longer when they're unsure where rates will go. This limited edition product gives brokers a way to structure cases that works for the customer today and doesn't leave them worse off when they come to revert.

“The reductions across our Pepper 48 and Pepper 48 Light ranges reflect our continued focus on giving brokers more choice. These are products for customers who are one step away from the high street, and the right rate can make a real difference to whether a case gets done.”