Yahoo Finance View: Bank of America is a good addition to your short list of lenders for several reasons, including closing costs and down payment assistance available to eligible homebuyers. It is also one of the the best mortgage refinance lenders available.
Bank of America is known for its commercial, industrial and investment banking prowess. But what about getting a home loan from such a financial giant?
Whether you’re looking for a 3% down payment mortgage or a way to unlock your home’s value with a home equity line of credit, BofA offers a large menu of mortgages.
Key benefits
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Bank of America offers grants of up to $7,500 in closing costs and up to $10,000 in down payment assistance to qualified buyers in many, but not all, states. This financial assistance makes BofA one of the best mortgage lenders for first-time buyers.
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A home purchase program for medical professionals allows borrowers to make smaller down payments and exclude student loans from debt limits. Residents and fellows can also take out a loan 90 days before starting a new position.
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Existing BofA Preferred Rewards members may qualify for an origination fee or interest rate deduction. You’ll likely need to sign up to draft your mortgage payments from a BofA bank account to qualify.
I need to know
To get started, visit Bank of America’s home mortgage loan site.
Bank of America Mortgage offers the following types of home loans:
Bank of America Mortgage does not offers the following types of housing loans:
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USDA loans
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Interest-only mortgages
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Loans for lots
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Construction loans
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Loans for boarding houses
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Loans for the second home
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Non-qualified mortgages
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Loans for real estate investments
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Energy efficient mortgages
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Loans for renovation
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1% down payment mortgages.
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Purchase loans
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Bridging loans
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Mortgage of prefabricated houses
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Piggy-back loans
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ITIN mortgages
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Home equity loans (Fixed rate HELOCs – which can be similar to home equity loans – are available, but more on those below)
Learn how a medical professional loan works and who qualifies.
An extensive first-time homebuyer section on BofA’s website offers educational articles about the mortgage process, tips, tools, frequently asked questions and a breakdown of loan options.
Bank of America offers the standard programs for first-time home buyers, including FHA, VA and a 3% down loan for income-qualified borrowers.
Contact information is easy to find and you can schedule an appointment, call, find a bank near you or start a chat. And it’s all conveniently placed right under the “Get Started” or “Learn More” buttons for a digital mortgage prequalification loan application.
Drawing cash from your home equity is easy with a home equity line of credit or home equity loan.
On the day I visited the website, Bank of America was promoting a low introductory HELOC rate. The bank also offers a fixed rate option. HELOCs are often variable rate loans. With the option to convert all or part of a HELOC (with a minimum line of credit of $5,000) to a fixed rate, it can work similarly to a home equity loan.
However, if you don’t convert the entire HELOC to a fixed rate, you’ll likely end up making two payments: one for the variable-rate line of credit and one for the fixed-rate loan balance.
BofA says a HELOC application takes “about 15 minutes” to complete. You can visit a bank location or schedule a mobile closing service to sign the loan.
BofA has no application fees, closing costs or annual fees for its HELOCs, and there is no fee to convert to a fixed rate home equity loan. These low fees have earned Bank of America a spot on the list of best HELOC lenders.
Mortgage rates are fairly easy to find on the Bank of America website. These are on the main home mortgage page. On the day I checked, the default rates shown were built on the assumptions of a credit score of 740 or higher, a 20% down payment and under a discount point.
You can update these generic rates by entering a purchase price, down payment and zip code into the calculator just above the interest rate table. Interestingly, the calculator pegs a down payment of 5% or more – even though BofA offers mortgages at 3%.
Yahoo Finance uses 2024 Home Mortgage Disclosure Act data from nearly 5,000 mortgage companies to rate mortgage lenders on mortgage rates issued and total loan costs. We score each lender on a scale of 1 (lowest) to 5 (highest).
For example, in terms of mortgage rates, a lender with a below Score charged a higher than median mortgage interest rate for the credits granted in 2024. A higher score would indicate that a creditor has granted lower than average home loan interest rates borrowers in 2024.
With total home loan costs, a lower score would indicate that a lender charged more than average total home loan costs in 2024. A high rating would mean a mortgage lender offered lower than average total home loan costs.
What this means: Bank of America Mortgage offered a lower than median mortgage rate of 6.125% and a near median total cost of borrowing of $5,161.63 borrowers in 2024.
At the top of the home loan page is a box with a large “Apply Now” button. BofA touts a “Digital Mortgage Experience” (branded, no less) and says it can take about an hour to get results from a pre-qualification application.
Mortgage pre-approval applications require more information and will take longer to complete. A pre-approval letter will arrive in the mail within 10 business days or can be accessed online much sooner.
When it comes to resources to help you think through the home buying process, things are pretty simple. Under “Resources & Tools,” you’ll find three calculators listed: affordability, mortgage payments, and closing costs.
Other tools are listed in the bottom menu.
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BofA Home Loans receives the highest rating (5) for Affordability because they offer so many loan options. A big part of securing a home often comes down to choosing the right mortgage.
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Offering lower-than-average interest rates and near-average total home loan costs, Bank of America can be a strong addition to your mortgage comparison shopping.
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Advertised rates are easy to find, fully explained, and somewhat customizable.
If you have a little savings for a down payment, Rocket Mortgage is worth checking out. While BofA offers a 3% down payment mortgage, Rocket Mortgage offers a 1% down payment loan.
But Bank of America stands out for its generous homebuyer assistance programs. Rocket matches the $7,500 down payment grant and closing costs that BofA offers; however, Bank of America also offers up to $10,000 in down payment assistance to borrowers in some states.
Rocket Mortgage Review
If you like a combination of online convenience with an in-person option, Bank of America offers the “Digital Mortgage Experience” and branches nationwide. However, its big bank competitor, Chase, also has an online loan application and pre-approval with mortgage counselors in most states.
The best choice may come down to if you need a unique type of mortgage. BofA offers medical professional loans, while Chase has home equity loans and interest-only mortgages.
Chase Home Loans Review
BofA offers a clickable “Call Us” link on its mortgage page that opens a Facetime call. Aren’t you ready for it? Here are plain old phone numbers: For existing mortgages, call (800) 669-6607. For new mortgage applications, call (800) 270-5746.
Whether you’re applying for a mortgage online or in person, BofA says you’ll need to have these documents handy to get started: W-2 forms for the past two years, recent pay stubs, bank and investment statements, tax returns, a copy of your home purchase agreement and, if you’re self-employed, a copy of your most recent income statement.
Using the Bank of America locator page, choose Home Loan Specialist from the Financial Center Services drop-down menu. You will see a map showing locations, hours of operation and directions to nearby offices.
Methodology:
Yahoo Finance analyzes and rates mortgage lenders with quintile scores in five main categories: 1) Interest rates. Using 2024 Home Mortgage Disclosure Act data from nearly 5,000 mortgage companies, we score mortgage lenders at mortgage rates issued below or above the annual average of reporting lenders. 2) Accessibility. A measure of the availability of loan products and a lender’s willingness to offer government-guaranteed loans, small down payments, down payment assistance and non-traditional credit consideration. 3) Loan costs. HMDA data is again analyzed and lenders are rated based on total loan costs compared to the annual average. 4) Assess transparency. A website user’s ability to obtain a mortgage interest rate estimate. We score lenders based on whether rates are enhanced with discount points or high credit score requirements, disclaimers disclosing rate assumptions, advertised sample rates, and whether or not adjustable discount point rate estimates are available. 5) Online functions. An analysis of the educational material, computers and additional resources available to users.
The National Multistate Licensing System (NMLS) data review of regulatory actions can trigger a penalty to the score of any lender with an administrative or enforcement action related to consumer mortgage lending in the past five years.
Advertisers or sponsorships do not influence ratings.
Editorial disclosures for mortgages:
The information in this article has not been reviewed or approved by any advertiser. Details of financial products, including interest rates and fees, are accurate at the time of publication. All products or services are presented without warranty. Check the lender’s website for the latest information. This site does not include all currently available offers.
Laura Grace Tarpley I edited this article.