A direct lender applies to any lenders that fund their own loans. Therefore, they can range anywhere from the biggest financial institution to a small independent company. 

Direct lenders may include mortgage bankers, portfolio lenders, or small lending companies. 

Banks and Savings & Loans obviously have deposits they can use to fund loans with, but they usually use warehouse lines of credit (informal name for lines of credit used to finance a borrowers temporary ownership of long-term assets such as mortgages) from which they draw the money to fund the loans. Similarly, smaller institutions also have warehouse lines of credit from which they draw money to fund loans.