Bank of America offers $17,500 grants for would-be homebuyers

Bank of America offers $17,500 grants for would-be homebuyers

Bank of America is launching a program that will provide financial assistance to would-be homeowners who need cash for a down payment and closing costs.

The Down Payment Grant program will provide as much as $17,500 to buyers who can make monthly mortgage payments but would have problems coming up with a down payment and closing costs. The bank’s $5 billion commitment is expected to help 20,000 people buy a house nationwide. The program is not exclusive to first-time buyers.

The down payment assistant is expected to especially benefit Inland Empire house hunters because of the region’s relative affordability. But even for a low-priced starter home, buyers still have to come up with as much as $15,000 for a government-backed loan, closing costs and other expenditures.

“The benefits of this program will be significant in the Inland Empire,” said John Loyacono, the area lending manager for Bank of America’s operations on the west side of Los Angeles. According to the bank’s research, 69% of all prospective buyers say down payments and closing costs are the biggest barriers to homeownership.

James Deason, a senior vice president and BofA’s lending manager for Riverside County, said there is no cap on income for applicants if the home you want to buy is in an area labeled “low-to-moderate,” in terms of the income of the neighborhood’s residents.

If the homes are considered to be in a “medium” or “upper” income area, there is a cap on the applicant’s earnings based on 80% of the income in that area. For the greater Riverside and Moreno Valley area, for example, that cap would be $52,640 a year, Deason said.

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The program offers up to $10,000 to help with the down payment, a grant that applicants do not have to repay. It also offers as much as $7,500 as part of the bank’s closing cost grant program.

Additionally, the bank could waive lender origination fees, usually about $1,000, for loans backed by federal agencies such as Freddie Mac, the Federal Housing Administration and the Veterans Administration. That advantage will expire on Oct, 31.

Information and application forms are available from lending specialists at any Bank of America office, Loyacono said.

The grant program has support from nonprofits in the Inland Empire, including the Neighborhood Housing Services of the Inland Empire, which provides counseling to would-be homeowners on matters that include loan assistance and home maintenance.

Dawn Lee, executive director and CEO of the San Bernardino-based nonprofit, said they provide eight hours of group counseling on homeownership for BofA grant applicants, which is a mandatory part of the process. She said her organization works with several major lenders, including Wells Fargo, which introduced a similar program earlier this year.

Lee lauded the lenders’ grant programs, calling them necessary in places like the Inland Empire.

“If people can’t come up with that initial trough of money, then they can’t come in the door,” she said.

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