Solent Mortgage Services (SMS) has said the recent move by Melton Mowbray Building Society to refresh its criteria shows how the mutual sector is a “vital force” in the UK lending market.

The Society has extended access to its 95% mortgage purchase product to include first-time buyers, shared ownership and all other house purchase. SMS, which has Melton Mowbray on its lending panel, was among the first distributors to embrace the resurgent mutual lenders.

Ian Balfour, CEO of SMS, said the intermediary specialist lending distributor has seen most of the recent innovation in the market coming from the mutual sector.

He said: “We have been particularly heartened to see the reemergence of the mutual sector, which has provided brokers with so much more variety of product offerings to those offered by the bigger players. Their hands on approach to underwriting and the understanding of the cases they take on has, in the case of Melton Mowbray, led to this decision to open up their lending at 95% to the widest range of purchase borrowers.

“We have always believed that the residential market would have completely stagnated by now, were it not for the arrival of new lenders and the new found confidence of the mutual sector. They have shown that it is possible to understand today’s lending risk and produce attractive products which clients need, without resorting to computer modeling and points scoring.”