flagFounded: 2000

businessOwned by: ASX Listed

monetization_onFunded by: Institutional funding and wholesale capital markets

securityLMI Provider: Self-Insured

account_balanceLender type: Non-Bank, Specialist Lender, Wholesale Lender

Pepper Money is Australia’s leading specialist lender both through mortgage brokers and as a wholesale funder for many non-bank lenders. They’ve won multiple awards, expanded into car loans and even expanded internationally to Europe and Asia.

Specialist lending used to be about lending to people with a bad credit history or who cannot prove their income. However, these days, specialist lending is about helping anyone who is a good borrower but isn’t being helped by the banks or is getting declined by the LMI providers.

How do Pepper’s home loans compare?

They’re great at

But they’ve got some drawbacks…

Coronavirus/COVID-19: Pepper home loan policy changes

In light of the economic impact from the coronavirus pandemic, Pepper Money have announced that affected industries such as:

  • Tourism;
  • Travel;
  • Hospitality;
  • Retail (not essential services);
  • Importing/Exporting;
  • AirBnB/ Uber;
  • Supply/Manufacturing;
  • Project Manager/IT as being the most impacted as such borrowers working in these industries will likely find it hard to get approved (considered on a case by case basis).

They have eased restrictions for customers in retail and hospitality industries.

In addition, income types such as bonus, commission and dividends are excluded from serviceability (borrowing power) calculations.

Moreover, casual income borrowers working in non-affected industries will have their income shaded by 50%, and probationary income is excluded from serviceability.

Also, overtime incomes will only be considered for essential workers such as nurses, paramedics, police etc.

Does Pepper accept JobKeeper?

Besides, Pepper will decline your loan application if your employer is receiving the JobKeeper payment.

Some of our other lenders will consider it.

Early release of super

Pepper will accept early release of super as funds to complete, however, you will have to thoroughly explain the situation for releasing super before it is accepted.

These policies are subject to change, so please get in touch with us for up to date information before applying for a home loan.

Coronavirus / COVID-19: Pepper Money mortgage relief

Pepper Money has announced that they’ll be working with its home loan customers financially impacted by the coronavirus pandemic.

Mortgage relief options include:

  • Accessing any extra mortgage repayments made on you loan;
  • Adjusting your repayments in line with the recent rate cuts by the RBA;
  • Temporary postponement of loan repayments (repayment holiday) or reduction of loan repayments; or
  • Extending the loan term (longer-term loan variation).

To apply for assistance, you can apply online through their website or you can call their customer care hotline on 1800 356 383.

Is Pepper reputable?

Pepper is usually our first choice of the specialist lenders if a bank cannot help one of our customers.

They’re ethical, efficient and have fair pricing that enables borrowers to buy a home or refinance even if they’ve been let down by other lenders.

A specialist loan is only step 1

Your mortgage broker’s job isn’t over when you get approved for a specialist loan. They should have a plan in place to refinance your loan in 2 – 3 years’ time to get you to an even better interest rate.

We normally look at how long it will be until you have a clear credit history or sufficient income evidence to qualify for a lower interest rate. Then we set a reminder and follow up on that date.

The great news is that Pepper has a range of prime home loans as well so you can actually refinance internally without too much hassle. You get a great interest rate, without too much paperwork.

What home loans types do they have?

Pepper has three main home loans and a variation for each depending on if you can prove your income or not.

Pepper Essentials is a prime loan for people with a clear credit history and who can either qualify with a bank or just falls outside of a bank’s lending criteria.

Pepper Easy is a near prime loans designed for people who have some blemishes on their credit file. Typically these borrowers are well outside of bank lending criteria.

Pepper Advantage is a specialist loan for people with serious credit impairment. It has a higher interest rate but it tends to be much more competitive than other specialist lenders.

On all of Pepper’s loans, you have the choice of Full Doc if you can prove your income with payslips or tax returns and Alt Doc if you are self-employed and can provide alternative proof of your income such as BAS, bank statements or an accountant’s letter.

Non-bank lender or investment bank?

During the GFC, Pepper took a new direction that we didn’t expect. Many of their competitors faced insolvency during the crisis and Pepper then swooped in and acquired their business or took over as the manager of their loan book.

Then Pepper went on an international spending spree that included an Irish Bank, a Korean Bank, a Spanish loan book and a Hong Kong Personal Loan business before returning to Australia to buy Citibank’s commercial loan book and Suncorp’s equipment finance loan book. Most of these acquisitions were at a significant discount.

They’re not just a good specialist lender, they’re also a smart investor.

Reviews from confused customers

Pepper took over the loan books for many of its competitors during the GFC but this had one problematic side effect.

Their competitors such as GE Money, Mobius and Seiza all faced financial trouble and put up their customer’s interest rates. This didn’t sit too well with customers, and after Pepper took over managing their loans they blamed Pepper for having a higher interest rate.

Some of them posted nasty reviews online blaming Pepper for something that was really someone else’s fault.

Tip for applying with Pepper

Use Pepper’s home loan application form to prepare for your home loan application.

Note: This is the latest home loan checklist as at October 2017. Please refer to Liberty for their most up-to-date document requirements.

Call us on 1300 889 743 or complete our free assessment form online and we’ll let you know if Pepper or another specialist lender is suitable for you.

Pepper Money client story: Charnel, Vic



Refinance, part 9 debt agreement, poor credit file.


After falling on hard times, Charnel took out a personal loan just to make ends meet as a single mum, keep paying her mortgage repayments and avoid declaring bankruptcy.

As the bills kept mounting up, she soon found herself defaulting on the personal loan and eventually made the tough decision to enter into a debt agreement with her creditor just so she could keep her home.

She knew she needed to pay out the debt agreement so she could avoid bankruptcy.

The interest rate is around 14-16%, around the same rate as a personal loan.


Charnel spent close to a year on the debt agreement before she sought help from a mortgage broker.

Very few lenders will accept someone with a debt agreement on their credit file but some specialist lenders will if you’re borrowing under 80% of the property value.

After putting Charnel’s case forward to La Trobe, RedZed and Liberty, the broker decided on Pepper because they could offer the cheapest non-conforming interest rate.

The variable rate was around 7.08% compared to more than 8% for the other non-conforming lenders. It’s also much cheaper than the 14-16% she was paying for her personal loan.

Charnel even had enough equity left over in her property to cash out $20,000 for renovations to her home.

If she can make perfect repayments for the next 12 months, she’s in a position to refinance back to a prime lender.

Compare Pepper Home Loans to other lenders

Not sure which lender is right for you? Our Home Loan Experts can help!

Talk to one of our mortgage brokers by calling us on 1300 889 743 or complete our free assessment form.