Wholesale vs Retail Mortgage Lenders: Which One Should You Pick?

Shopping for a mortgage? Here’s the thing most people miss: lenders come in two flavors—retail and wholesale. And picking the wrong one could cost you serious money.

The Core Difference

Retail lenders are the obvious choice: banks, credit unions, online platforms. You apply directly, talk to them, done.

Wholesale lenders work through intermediaries—usually mortgage brokers. You never deal with them directly. The broker collects your docs, shops around with multiple lenders, and finds the best fit.

Why Go Wholesale?

✓ More options. Brokers access products retail banks won’t touch, especially if your credit isn’t pristine.

✓ Less work. Broker does the rate comparison legwork while you chill.

✓ Potentially cheaper. Some borrowers save thousands over 30 years—though do the math yourself to verify.

The Catch

✗ Hidden fees. Brokers get paid, and guess where that cost goes? Your loan.

✗ Communication lag. Working through a middleman means slower responses, more back-and-forth.

✗ Account hassle. Your mortgage ends up at a different bank than your main account.

Bottom Line

Wholesale makes sense if you’re time-crunched, don’t have a lender preference, or live in an area with few options. Otherwise? Retail lenders keep things simple and direct.