The wholesale lender is the upstream funding source in the mortgage broker channel. Where retail lenders work directly with consumers, wholesale lenders work exclusively through licensed mortgage brokers who manage the borrower relationship.
How wholesale works
- Mortgage broker meets with borrower, takes application
- Broker submits the loan to one or more wholesale lenders for pricing
- Wholesale lender provides rate sheet and program guidelines
- Broker selects the best fit lender, presents to borrower
- Wholesale lender underwrites and approves
- Wholesale lender funds the loan at closing; broker collects compensation from the wholesale lender (LPC) or borrower (BPC)
- Wholesale lender then sells the loan to investors on the secondary market
Major US wholesale lenders
- United Wholesale Mortgage (UWM) — largest US wholesale lender by origination volume
- Rocket Wholesale (Rocket Pro) — wholesale arm of Rocket Companies
- Newrez Wholesale — wholesale arm of Newrez/Rithm Capital
- Plaza Home Mortgage, AmeriHome Mortgage, Caliber Wholesale, others
Wholesale vs retail vs correspondent
- Wholesale — funds loans originated by independent brokers, no direct consumer relationship
- Retail — originates loans directly with consumers through their own LO sales force
- Correspondent — buys closed loans from smaller lenders who originate and fund first, then sell to the correspondent
