Pepper Money gains regulatory approval for Optimum Credit integration

Pepper Money gains regulatory approval for Optimum Credit integration


Optimum Credit will be rebranded as Pepper Money, so the lender will now offer a range of first and second charge mortgages.

The rebranding will happen in around three weeks’ time and Pepper Money said the integration will create “one of the most comprehensive specialist lending propositions in the market”.

Pepper Money bought second charge lender in Optimum Credit in 2018, which included a second charge loan book of more than £450m at the time.

Optimum Credit was launched in 2014 and has advanced funds of over £1bn since it was founded.

Laurence Morey (pictured), chief executive at Pepper Money, said the goal at Pepper Money had always been to become the number one specialist lender by “delivering a proposition that supports greater financial inclusion”.

He said the purchase of Optimum Credit was part of the plan, as he described it as the “leading second charge lender in the market”.

Morey added: “Optimum Credit has such a strong reputation, it was very important that we let it continue to do what it has been doing so well for a number of years and so many of our customers and brokers would have noticed little change. But in the background, we have been working on getting everything right to bring the two businesses together under the Pepper Money brand.

“Today is an important step on our new journey. The closer collaboration will open up new opportunities for our business and our intermediaries, laying the foundation for us to further build on our proposition in the future.”

Second charge lending on track to hit £1bn this year – Loans Warehouse

Second charge lending on track to hit £1bn this year – Loans Warehouse


According to Loans Warehouse’s managing director Matt Tristram, the second charge market last reached this figure in 2019. He said the £1bn target was a “benchmark for success for second charge lending”.

Its Secured Loan Index report highlighted that in October the volume of second charge lending came to around £123.6m, which is up £13.4m on the previous month, and the highest recorded under FCA regulation. The previous peak was in 2019 at £118m.

These figures were boosted by the addition of Selina Finance to the market and the removal of pandemic restrictions.

Earlier this week Selina Finance launched an 85 per cent loan to value (LTV) second charge range.

Completions in October also grew by 10 per cent from September to 2,839, which is a record high.

Consolidation loans made up around 46 per cent of loans offered in this period, which was followed by consolidation and home improvements at around 30 per cent and home improvements at around 19 per cent.

The average completion time for second charge loans in October was 17 days, which is 1.7 days faster than September. The average term for a second charge loan was 18.8 years.

Around three quarters of loans offered in October were below 85 per cent LTV, which the report said was because first charge lending at higher LTVs had become more limited during the pandemic. Borrowers’ equity, therefore, was limited and second charge became an alternative method for raising capital.

The proportion of second charge loans below 85 per cent LTV was higher during the pandemic when first charge higher LTV lending was more limited, according to Tristram.

The report collates second charge lending figures from Optimum Credit, Oplo, United Trust Bank, Together Money, Masthaven, Norton Home Loans, Equifinance, Evolution Money, Spring Finance and Selina Finance.

Optimum Credit hires Batte as southern BDM

Optimum Credit hires Batte as southern BDM


Batte worked at Shawbrook Bank for around three years previously, most recently as a senior relationship manager.

Prior to that he worked at First Trust Finance for nearly three years as a sales manager, working at Optimum Credit before that as a broker account manager for under a year and First Trust Finance as a senior underwriter for nearly eight years.

In his role he will work with southern brokers to help them meet clients’ capital raising needs. The company offers variable, fixed and discounted second charge mortgages worth from £5,000 to £1m.

Simon Mules, Optimum Credit’s commercial director, said: “I’d like to welcome Matthew back to Optimum Credit. He has a great pedigree in second charge lending and will be a huge asset to our business and brokers.

“We continue to lead the way in this market, and we have ambitious growth plans for the business as part of the Pepper Money group.”

Pepper Money bought the second charge lender in 2018.


Optimum appoints Caroline Mirakian ahead of Pepper Money integration

Optimum appoints Caroline Mirakian ahead of Pepper Money integration


She joins from Pepper Money, where she has worked as head of national accounts since 2019. Her previous experience also includes roles at Barclays, RBS, Lloyds Bank and Shawbrook Bank, where she was head of intermediary distribution. 

Optimum Credit currently only offers second charge mortgages. The distribution and sale of these will be under the responsibility of Mirakian. 

Under the integration, the Optimum Credit brand will be retired and its operations will continue under the Pepper Money brand. Pepper Money purchased Optimum Credit in 2018. 

Pepper Money has said it wants to invest in its second charge business and recently announced plans to expand its second charge business development team. 

Paul Adams, sales director at Pepper Money, will continue to oversee the first charge sales team. 

Simon Mules, commercial director at Optimum Credit, said: “Caroline has extensive experience in intermediary mortgages and second charge lending and I’d like to congratulate her on this new role, which forms an important part of our plans at Optimum.  

“We have said previously that our aim is to operate the leading second charge lender under the Pepper Money umbrella. We are currently working towards this milestone and will make a further announcement as soon as we are able.” 

Mirakian (pictured) added: “I’m really excited about this new role and the potential we have at Pepper Money to grow our business by improving the lives of our intermediary partners and, ultimately, our customers.” 

Together and Optimum Credit update second charge offerings

Together and Optimum Credit update second charge offerings


Together has launched a limited edition two-year fixed prime plus deal with an interest rate of 4.29 per cent for capital repayment and 4.79 per cent for interest only.

It has also cut the rate on its five-year fixed second charge products by a full one per cent to 4.99 per cent for capital repayment and 5.49 per cent for interest only.

The lender has also increased the maximum LTV for its second charge term products, which are initially available for three months, from 70 to 75 per cent.

And Together has reduced the number of supporting documents brokers must submit during the personal and commercial finance application processes — by updating what document checklists its broker portal requests and streamlining the credit search process.

Sundeep Patel, director of sales at Together, (pictured) noted that self-employed customers, freelancers and contractors, those on zero-hour contracts and retired people may be eligible for loans.

“We expect demand in the second charge market to grow significantly throughout this year and are refreshing our product offering,” he said.

“These changes may help borrowers who have been locked out by high street lenders.

“At a time when people’s circumstances may have changed due to coronavirus, we think it’s important that lenders offer flexible criteria and competitive rates to increase the choice available in the market.”


Optimum Credit

Meanwhile, Optimum Credit has today released a new suit of products called Optimum Plus.

Broker firm Loans Warehouse said the product range has been designed to target underserviced areas of the markets.

This included newly self-employed applicants, borrowers with complex and multiple income streams, benefits or variable income and would offer longer terms for older borrowers.



High LTV second charge lending doubles

High LTV second charge lending doubles


Its secured loan index recorded 1,768 completions last month, up 24 per cent on January, and noted that higher loan-to-value (LTV) lending doubled month-on-month.

This was influenced by high street lenders continuing restrictions on high LTVs, while options with second charge lenders expanded.

Market activity included the return of the Plus Range from Equifinance, as well as the effects of keen pricing at high LTVs from Optimum and Oplo, the broker firm added.

Spring Finance returned to second charge lending this week, with loans up to £100,000 at 75 per cent LTV.

The average term dropped from 16 to 14 years in February. Completion times also fell to 11.6 days, down 13 days in January.

The index also predicted the highest lending figures since the start of the pandemic for March.

“Demand in the months ahead will soar, with the benefits of the vaccine roll-out, schools reopening and lockdown ending,” said Loans Warehouse managing director Matt Tristram.

The most popular use of a second charge loan was debt consolidation, then consolidation and home improvement, followed by home improvement, in February.

The index is produced by Loans Warehouse and The Secured Loan Broker, based on data from second charge lenders including Optimum Credit, Oplo, United Trust Bank, Together Money, Masthaven, Norton Home Loans, Equifinance, Evolution Money and Clearly Loans.


Pepper Money completes £629m securitisations

Pepper Money completes £629m securitisations


The first transaction was a £352m securitisation of specialist first charge residential and buy-to-let mortgages originated by Pepper Money.

This was followed by a £277m securitisation of second charge mortgages originated by Optimum Credit.

Both transactions attracted strong investor demand and were oversubscribed in a competitive market and uncertain economic environment, the lender said.

Pepper Money and Optimum Credit recently signalled increased lending appetites with the launch of enhanced products and criteria.

Laurence Morey, chief executive of Pepper Money (pictured), said: “The success of these securitisations is particularly pleasing given the completely unprecedented environment we have lived through in the last six months and the challenges faced by non-bank lenders.

“It is reassuring that there continues to be such strong investor demand for high-quality assets and this provides us with a solid foundation on which we can confidently continue to grow our first and second charge lending volumes.

“We will, of course, remain cognisant of the changing environment and maintain a robust and appropriate approach to underwriting, but we do so with an honest appetite to lend and a deep commitment to supporting our intermediary partners.

“I am confident that the challenges we have overcome will help us to establish a stronger sector that is better able to deliver the solutions that brokers need to meet the changing needs of a diverse group of borrowers.”


Optimum Credit eases credit criteria and reintroduces near-prime seconds

Optimum Credit eases credit criteria and reintroduces near-prime seconds


On affordability, the lender is now able to accept up to 50 per cent of variable income including bonus, overtime and commission.

It has lifted restrictions on previous defaults, county court judgements (CCJs) and payday loans – returning this criteria to its pre-Covid-19 approach.

The lender has increased its maximum loan size to £1m and reintroduced its Near Prime range for customers whose credit profile falls just outside of its prime rates.

And it has made interest rate reductions across its entire pricing model and re-introduced options for variable rate, discounted rate and interest-only products.

Optimum Credit commercial director Simon Mules (pictured) said: “The last six months have been challenging for everyone and I would like to thank all of our intermediaries for their continued support.

“We hope that this launch is the start of a new chapter – it is certainly a statement of our intent to grow our lending volumes and continue to take a leading role in the second charge mortgage market.”


Optimum Credit hits £1bn lending milestone

Optimum Credit hits £1bn lending milestone

Last month, the lender processed a record number of new deals.

Hitting the £1bn target was milestone in its five-year history said the firm.

The Cardiff-based company was acquired by specialist lender Pepper Money in October 2018.

Chief executive Sam Marshall (pictured) said: “When we started up the company we set out to become the biggest second charge lender in the UK, a target we achieved very quickly. Our acquisition by Pepper Money will enable us to continue to grow, and we look forward to further successes in the future.

“Despite some uncertainties in the lending market given the ongoing Brexit discussions, we have found the second charge market to be very buoyant.”

The number of new second charge mortgage deals taken out in July came to 2,656, according to data from the Finance & Leasing Association (FLA)

The figure represented an increase of 23 per cent on July 2018.

The value of that business has risen 17 per cent to £115m for July this year compared to the same month in 2018.

Optimum Credit ups maximum LTV to 100 per cent

Optimum Credit ups maximum LTV to 100 per cent


The lender said it was making the move as it sought to innovate and expand the market to help advisers give customers good outcomes.

Loans are available from £7,500 to a maximum of £100,000 inclusive of fees, with a full valuation required on each case.

The minimum valuation is £85,000 and loan terms are available from three years to 30 years.

The new offering is available on Optimum’s variable rate loan and fixed rate loans from two to five years.

Optimum Credit commercial director Simon Mules said: “This is a high-quality product for borrowers with a track record of sound financial management, and we have a robust affordability assessment to ensure that our customers have the means to repay their loans without difficulty.

“We have an unrivalled track record in originating prime second charge mortgages, and we have the full backing of our funders in the launch of this new product.”