Mortgages overseen by Pepper were reported to have undergone refinancing in a 19-month period, amounting to 13% of the total mortgages managed for funds.
In the Irish mortgage market, nonbank lenders are showing a moderate increase in refinancing activity, accounting for approximately 13% of loans managed since the beginning of 2024. This uptick can be attributed to the European Central Bank's (ECB) rate hikes and subsequent rate reductions, as well as some easing of rates by banks and specialist lenders.
Niall Sorohan, the CEO of Pepper Advantage Ireland, a significant player in the nonbank lending sector, has noted that some customers have utilised savings and investments to pay off their mortgages following the ECB's rate hikes. However, a portion of Pepper Advantage Ireland's customers have faced challenges in refinancing elsewhere due to their poor repayment histories.
In a positive development, more than 7,000 loans managed by Pepper Advantage Ireland have been refinanced since the start of 2024, representing over 13% of the loans under management. This refinancing activity reflects a growing but still limited response to the ECB rate hikes and changing conditions.
However, the issue of "mortgage prisoners" in Ireland remains a challenge. These are homeowners who are unable to refinance due to being trapped on outdated or expensive deals. Despite some recent small rate reductions from mortgage providers, comprehensive government or regulatory-led programs specifically targeting mortgage prisoners have not been detailed in the latest sources.
A new entrant in the market, Núa Money, has introduced a product specifically aimed at "mortgage prisoners" who have a history of financial difficulty but have recently improved their repayment track record. Meanwhile, the Banking and Payments Federation of Ireland (BPFI) launched an initiative in 2023 to help struggling mortgage holders move their loans from credit servicing firms to mainstream banks, potentially offering them a chance to escape higher interest charges.
Pepper Advantage Ireland, which manages over 100,000 loans, has been criticised for charging some of the highest mortgage rates as official borrowing costs spiked, with some loans carrying variable rates of 10 percent. However, the company has helped a steady stream of customers redeem their mortgages over the years.
For mortgage prisoners who find themselves unable to refinance with current lenders, exploring alternative lenders, including some nonbank lenders, may provide some relief. It is also advisable to seek advice from financial or legal experts familiar with Ireland’s mortgage market regulations and potential relief schemes.
As the lending environment cautiously improves, with some easing in credit standards for residential real estate expected in the remainder of 2025, it is hoped that more choices will become available for customers, leading to increased competition and better deals for borrowers.
- Some individuals in Ireland's mortgage market, faced with poor repayment histories, have struggled to refinance with traditional banks, but exploring personal-finance options offered by alternative lenders, such as Núa Money, might offer them a chance for relief.
- In the realm of personal-finance management, the Irish mortgage market is gradually becoming more competitive, as some nonbank lenders, like Pepper Advantage Ireland, offer alternatives to homeowners who have been unable to refinance due to being 'mortgage prisoners'.
