Pepper Money has issued a new range of mortgages aimed at potential borrowers who have been discharged from bankruptcy or an individual voluntary arrangement.

The lender has also opened its core range of products to clients who are currently in a debt management plan (DMP).

The new bankruptcy range requires the borrower to have been discharged for at least three years previous to the application and is available at up to 75% LTV on either a two-year fix starting at 6.74% or a five-year fix starting at 6.84%.

Pepper Money sales director Paul Adams says: “We understand that people do have life events, such as divorce or loss of employment and that this can create stresses on finances which at worst, can lead to bankruptcy or an IVA.

“It’s important to understand the situation and establish whether a customer has resolved whatever issues led to the bankruptcy or IVA in the first place, as with any other credit event.

“But it’s also important to offer these customers a fresh start when it is clear they have put their previous issues behind them

“Financial inclusion is a focal component within our lending ethos and we understand the importance of our role, as a lender, to provide mortgage options to customers who have taken a proactive step to tackle their debt through a DMP.

“Following a review our criteria and pricing, we’re pleased to now to lend to borrowers in an active DMP as part of our core range.

“This will lower the cost of borrowing and open up higher LTVs for a large group of people.”