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Like other traditional banks, Bank of America is facing stiff competition from a new breed of online mortgage lenders like Quicken Loans.
With the launch of its own digital mortgage platform in 2018, Bank of America can be a good choice for buying a home or refinancing a home mortgage — particularly if you’re already a customer. Keep reading this Bank of America review to find out everything you need to know if you’re considering a home loan.
- Bank of America home loans
- Bank of America mortgage process
- Bank of America mortgage products
- How Bank of America shines
- Compare mortgage rates from multiple lenders
Bank of America home loans
- You’re already a Bank of America customer
- You prefer to meet with a loan officer in person
|Mortgage programs||Conventional, jumbo, FHA, VA
|Fixed-rate loan terms||15-, 20-, and 30-year|
|Variable-rate loan terms||5/1, 7/1, and 10/1 ARM|
|Minimum FICO||580 FICO for FHA loans
|Minimum down payment||• 3% conventional
• 3.5% FHA
• 0% VA
Bank of America is one of many big banks in the world, serving 66 million consumer and small business customers in the U.S. through a network of 4,300 retail financial centers.
So even though you can apply for a Bank of America mortgage loan or mortgage refinance online, you also have the option of working with a loan officer in person, over the phone, or by video conference.
Bank of America mortgage process
Bank of America’s Digital Mortgage Experience lets the homebuyer use the company’s website or mobile banking app to apply for a mortgage. If you’re already a Bank of America customer, the app will pre-fill much of the application for you, and many clients get conditional approvals the same day.
Another perk for existing customers: If you’re enrolled in Bank of America’s Preferred Rewards program, you can qualify for a $200 to $600 reduction in the origination fee the bank usually charges for purchase or refinance mortgages (based on the combined balances of your Bank of America accounts).
After submitting your application, Bank of America’s Home Loan Navigator app lets you track its status and see any outstanding “to-do’s” needed to keep the application moving. Home Loan Navigator lets you sign and submit many loan documents online, and you can also choose to receive your disclosures digitally, so you don’t have to deal with a mountain of paperwork.
Bank of America mortgage products
Bank of America offers a broad selection of mortgages at competitive rates, including conventional, jumbo, FHA, and VA loans. You’ll typically have a choice of a fixed- or variable-rate loan, with a range of repayment terms.
If you only have enough savings to make a small down payment, FHA and VA loans may be an option. Bank of America also offers an “Affordable Solution Mortgage,” which is a fixed-rate loan with a 25- or 30-year repayment term that allows for down payments of as little as 3%.
Bank of America offers a full range of refinancing options, including cash-out refinancing, as well as FHA and VA refinancing.
If you’re looking for a fixed-rate loan, you can choose a 15-, 20-, or 30-year loan term when refinancing. Adjustable-rate mortgages are available with 30-year repayment terms, with the initial interest rate fixed for the first five, seven or 10 years and adjusting once a year after that (5/1, 7/1, and 10/1 ARMs).
The process for refinancing is much the same as when taking out a purchase mortgage. You have the option of applying online and using Bank of America’s Home Loan Navigator to track your application through a mostly paperless process.
Home equity line of credit
If you’re looking to tap some of your home’s equity, one advantage of working with a bank is that they’re more likely to offer a home equity line of credit (HELOC). Bank of America doesn’t charge an application fee or annual fee, and there are no closing costs on lines of credit up to $1 million.
Although interest rates on HELOCs are typically variable, Bank of America will allow you to convert all or some of your variable-rate balance to a fixed rate without charging you a conversion fee.
Bank of America also offers a 0.25% interest rate discount on HELOCs if you authorize automatic payments from your Bank of America checking or savings account. In addition, if you make a withdrawal as soon as you open your HELOC, you’ll receive a 0.10% interest rate discount for each $10,000 withdrawn, up to a maximum of 1.5%.
Also, if you’re enrolled in the Preferred Rewards program, you can qualify for an interest rate discount of 0.125% to 0.375% on a HELOC, depending on the balance in your other B of A accounts.
How Bank of America shines
If you’re thinking about buying or refinancing a home, Bank of America could be a good choice if:
- You’re more comfortable doing business with an established, major bank
- You’d like the flexibility of applying online or working with a loan officer in person, over the phone, or by video conference
- You’re an existing B of A customer who would benefit from having much of your application pre-filled and potentially qualify for a discount on origination fees
Compare mortgage rates from multiple lenders
Like any traditional bank or direct lender, Bank of America can only offer you its own products, which may not offer the best rates and terms you could qualify for. So before you decide if a Bank of America home loan is the right choice for you, make sure to compare options with other lenders.
Credible lets you compare personalized mortgage rates from multiple lenders who offer refinancing and purchase loans. If you qualify, Credible can provide a streamlined preapproval letter in just 3 minutes. Your data is never sold, so you’re protected from spammers. If you find an option you like, Credible’s digital platform automates much of the origination process.
Keep in mind that not all loan products are available through Credible.