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Bank of America Mortgage Review 2020

Customer discount: Some Bank of America customers will qualify for a discount on the mortgage origination fee. To be eligible, the customer must sign up for the Preferred Rewards program, which requires a three-month combined average daily balance of $20,000 or more in qualifying Bank of America banking accounts and/or Merrill investment accounts. The Preferred Rewards program is free to join, and the origination fee discounts are as follows:

  • $200 discount for Gold tier members (combined balance of at least $20,000)
  • $400 discount for Platinum tier members (combined balance of at least $50,000)
  • $600 discount for Platinum Honors tier members (combined balance of at least $100,000)

Preferred Rewards members can also get a mortgage interest rate discount of up to 0.375% on a home equity line of credit (HELOC).

Affordable mortgage loans: Bank of America offers multiple loan options to borrowers who have qualifying incomes and may be low on available cash.

  • The Affordable Loan Solution® program requires a 3% down payment on loans of up to $510,400, and there is no mortgage insurance requirement.
  • The Freddie Mac Home Possible® mortgage has the same low down payment requirement but requires mortgage insurance and more cash reserves.
  • Both loans require a 5% down payment on loans of $510,401 to $765,600 in high-cost areas.
  • For both programs, income limits and other conditions apply.

Qualified applicants can apply for a VA loan (Department of Veterans Affairs), which has no minimum down payment requirement.

Cash grants: Bank of America offers closing credits up to $7,500 and down payment grants of up to $10,000 (the programs can be combined for a total possible benefit of $17,500). Eligibility requirements include income caps, geographical restrictions, occupancy restrictions (primary residence only) and loan limits.

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Through the Bank of America Down Payment Center, a comprehensive online resource, the bank also helps borrowers identify other down payment and closing cost assistance programs that may be specific to the county or city where the borrower lives. Bank of America places no restriction on the combination of assistance programs it will allow. Many homebuyer assistance programs are for first-time homebuyers only and require homebuyer education.

Affordable HELOC: For borrowers considering a cash-out refinance loan, Bank of America’s home equity line of credit may be an alternative to consider. It comes with no application fee, no closing costs, no annual fee, and no fee to access cash. Bank of America makes HELOCs even more affordable with interest rate discounts that are available to customers who set up automatic payments and those who make an initial withdrawal of at least $10,000. Also, there is no fee to convert a variable-rate HELOC to a fixed-rate loan.

Digital application: Many buyers want to handle financial matters from the comfort and privacy of home, and Bank of America delivers with a fully online application process.

Accepts non-traditional credit data: To help more borrowers qualify, Bank of America considers alternative credit data such as rent, utility, and cellphone payments for some of its loan products.

High industry rankings: Bank of America consistently ranks highly in independent studies:

  • Second in customer satisfaction with retail banking advice in the JD Power 2020 Retail Banking Advice Satisfaction Study
  • First in customer satisfaction with retail banking advice in the JD Power 2019 Retail Banking Advice Satisfaction Study
  • A+ rating with the Better Business Bureau
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