Pepper Money – One in two people who miss payments on unsecured credit go on to default

Pepper Money LogoPepper have started 2024 as they hoped to continue by lowering rates by up to 0.98% to enhance their offering, which is believed will allow Connect Mortgage’s registered advisers to help more customers.   Customers are central to what we do, and as a result we would like to share further insights on the types of customers which a Pepper mortgage may be ideal for.

One in two people who miss payments on unsecured credit go on to default

Pepper Money recently launched the seventh edition of our Specialist Lending Study in partnership with YouGov. They surveyed more than 6,000 UK adults, indicative of a demographically representative sample of the British adult population.

In case you missed it, it was uncovered that 15.16 million people have a history of adverse credit – missed credit payments, Defaults, CCJs, unsecured arrears, secured arrears or entered a DMP.

Key findings highlighting levels of unsecured debt

  • 49% of people who’ve missed one credit payment say have then gone on to miss further credit payments.
  • 45% of people with adverse credit say their use of Buy Now Pay Later credit has increased in the last year. 17% say it has increased a lot.
  • 30% of people with adverse credit have unsecured debt of more than £5,000. 17% have unsecured debt of more than £10,000. 9% have outstanding debts of more than £15,000.
  • 43% say their level of debt has increased in the last year.
  • 36% of people with adverse credit are concerned that their level of debt will impact their ability to get a mortgage in the future.

One way customers can get on top of their debts is by raising capital with a remortgage to pay off the separate balances, consolidating them into additional borrowing secured against their property.

Restructuring finances requires careful consideration of the risks involved, as it may increase the overall amount that is repaid, however, it can also prove to be a vital lifeline for households struggling in the current environment to reduce their monthly costs.

To find out more about how you can support your customers in the challenging economic environment, discover the full insights of the Specialist Lending Study.