- For readers who may be newer to Perenna, how would you describe the lender’s proposition today, and what gap do you think it is filling in the UK mortgage market?
The UK market has a wide range of underserved segments, leaving millions without the ability to own a home. Many of these people simply need the right mortgage products. Perenna’s mission is to help create a nation of happy homeowners by delivering them.
Long-term fixed rate mortgages sit at our core. The UK’s focus on short term products restricts the amount lenders can lend, puts undue stress on the borrower, and ultimately leaves us vulnerable to economic and geopolitical turbulence. This also has an impact on affordability and hampers those trying to get off renting into homeownership.
Those who lack credit history, whether it’s a first-time buyer or a pensioner who has long since paid off their mortgage, often struggle to borrow. That isn’t the case with Perenna. We can deliver bespoke solutions to those who struggle to get viable products in the mainstream market.
There is still an enormous need for legacy products, but we’re in desperate need of real innovation and a widespread reimagining of how we approach mortgages and homebuying in the UK.
- Where does Perenna see the biggest opportunity to reshape expectations around what a mortgage product can offer UK borrowers?
The biggest opportunity is to shift the societal perception of a mortgage.
For most people, a house is the most valuable asset they will ever own, and a mortgage is the largest debt they’ll hold. It should therefore be protected from volatility, not exposed to it. For many households, the real value of a mortgage lies in being able to plan ahead, manage a budget with greater confidence and reduce the risk of payment shocks over time.
For a long time, much of the public discussion has focused on house prices, base rates and housing supply. Those issues matter, but mortgage design also plays a major role in whether homeownership feels secure in practice. If the structure of the system keeps pulling people back into refinancing cycles every few years, instability will continue to return even when wider conditions improve.
That is where Perenna sees room to challenge assumptions. Mortgage products should do more than simply help someone buy a home. They should also support them once they are there, whether through longer-term fixed rates or other fixed-rate options that balance affordability, stability and flexibility. That matters too for groups who can be less well served by traditional lending models, including younger customers, expats, more recent arrivals to the UK with thinner credit files, and older downsizers looking for greater predictability.
- Perenna recently announced its partnership with Raisin following PRA and FCA authorisation to accept retail deposits. What does this mean for lenders and borrowers going forward?
As we roll out new, innovative products, we need new funding solutions to back them up. PRA and FCA authorisation to accept retail deposits gives us another way to fund lending, which supports a broader and more durable business model as we grow. Covered bonds will eventually finance our 30-40 year fixes, but for our shorter fixes, retail deposits are well-suited. The partnership with Raisin enables this.
Building Labour’s 1.5 million new homes will require an enormous amount of mortgage financing. We therefore need to provide avenues for investment from the biggest institutional investor to the smallest retail saver. Perenna’s model facilitates both. It is this type of fresh thinking that will ultimately drive better outcomes for consumers, lenders and the wider market.
- Looking ahead, what most needs to change for the UK mortgage market to give more borrowers greater confidence and payment certainty over the long term?
The main change is that stability needs to become a more central feature of mortgage design, rather than an afterthought. For too long, the system has treated repeated refinancing as a normality, even though that can leave households exposed to sudden changes in monthly costs when rates shift or the wider economy comes under strain.
A stronger market would do more to absorb that pressure rather than pass it directly through to customers. That means broadening the range of products that support payment confidence over time, including longer-term fixed-rate mortgages and other fixed-rate options that help people manage affordability across different life stages. The aim should not only be to help people buy a home, but to help them keep that home financially manageable once they have done so.
If the UK wants a mortgage system that feels more secure, the answer is not simply to wait for rates to improve as you cannot control the timing. It is to build a framework that gives people greater confidence over the long term and makes payment stability a more established part of what the market delivers.
