The specialist lender said 73% of people with adverse credit revealed a simple missed credit payment had caused the blight on their file, with 43% of adults saying they had missed more than one.
The second most common reason for adverse credit was a default, as a result of several missed credit payments – something which had been experienced by 35% of those quizzed by YouGov on behalf of Pepper Money.
It also found just over a quarter (27%) had entered into a Debt Management Plan and a similar number (26%) had unsecured arrears.
Just over one in five people with adverse credit (22%) have had a CCJ registered against them in the last three years, and this has increased from 18% since the research was last carried out in autumn 2020.
The least common reason for adverse credit was secured arrears, which has been experienced by 18% of people with adverse credit.
The latest wave of the Pepper Money Adverse Credit Study found that 6.29 million people in the UK have experienced some form of adverse credit in the last three years.
Paul Adams, sales director at Pepper Money, said: “There are well over six million people in this country who have some sort of adverse credit on their file from the last three years.
“Often it’s simply the result of a missed credit payment, or multiple missed payments. Over two million people have received a default, and nearly 1.4 million people have received a CCJ – including, of course, Boris Johnson, according to recent reports.
“The ways in which people can get an adverse credit record and the circumstances that lead to it are diverse, but the unifying factor for all of these customers is that there are mortgage lenders able to make sensible decisions based on their individual circumstances and provide opportunities to borrow the money they need to meet their goals.
“At Pepper Money, we take just this approach. Every application is assessed by an expert underwriter who takes the time to understand a customer’s circumstances and their ability to maintain mortgage payments. This means we don’t exclude customers just because their circumstances seem complex. Instead, we look for reasons to lend and deliver a more inclusive approach to mortgages for a more diverse range of customers.”
