Borrowers can save an average of $10,662 over the life of a residential loan when they work with an independent mortgage broker, according to research published with support from United Wholesale Mortgage (UWM).

Conducted by Polygon Research with support from UWM and Willow Canyon Advisors, the study analyzed 2023 records from the Home Mortgage Disclosure Act (HMDA), along with monthly agency single-family performance and mortgage-backed securities loan-level data.

Per the study’s findings, purchase loan borrowers paid an average of 115 upfront basis points for an average mortgage interest rate of 6.58%. Purchase borrowers who used nonbank retail lenders got an average rate of 6.6% by paying 148 bps.

The study also concluded that certain demographics, like veterans and minority borrowers, found savings in the wholesale channel. On VA loans from nonbank lenders, for example, the study found that borrowers saved $13,432 per loan on average when working with an independent mortgage broker. The broker channel also saw a higher share of purchase loans approved for minority borrowers compared to the retail channel, including over 1.4 million mortgages originated in majority-minority census tracts last year.

“The research shows brokers not only offer better deals on average, but also excel in reaching minority communities, especially in times when affordability is a key concern,” said Jonathon Haddad, CEO of the Association of Independent Mortgage Experts (AIME). “The numbers in this study speak for themselves, and further underscore the importance of educating consumers across the country on the benefits of getting a mortgage with an independent mortgage broker.”

“As we’ve been saying for over a decade, the wholesale channel continues to showcase time and time again that it is the best place for a consumer to get a loan,” said Mat Ishbia, president and CEO at UWM, which exclusively originates within the wholesale channel.

“This data further proves that when consumers work with an independent mortgage broker, they typically save thousands of dollars, and almost always have a faster, more seamless and personalized experience. The broker channel has seen tremendous growth over the last few years because of these direct consumer benefits.”

Ishbia expressed confidence in the wholesale market’s continued growth, saying he and UWM “don’t believe it’s unrealistic” for the broker channel to reach 50% market share.