Pepper unveils interest rate discount scheme for struggling mortgage customers

In July, Pepper announced that it would add between 0.5 and 1.25 percentage points to the cost of most of the 21,000 variable mortgages it services. The average rate across Pepper’s loan book stood at 6.3 per cent before the move and is now at approximately 7 per cent. This compares with the average variable rates of between 3.8 per cent and 3.95 per cent offered by Bank of Ireland, AIB and Permanent TSB.

“We are closely monitoring the impact rising interest rates are having on certain tracker mortgage customers,” said Cormac Ryan, chief executive of Pepper Advantage. “Some of these mortgage loans are interest-only mortgages, meaning these customers have been the most impacted by rising rates and escalating monthly payments.

In Government and across the financial services sector, there is growing concern about the potential for rising rates to put mortgage customers into arrears.

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