Bank of America Mortgage Review 2022

As the second-largest bank in the U.S., Bank of America is a popular option for prospective homebuyers who want to get a mortgage. 

Besides its credit cards and checking and savings accounts, Bank of America also offers a variety of mortgage products. Whether you’re a first-time homebuyer or you’re looking for a jumbo loan to buy your dream home, Bank of America likely has an option that could match your needs. 

In general, borrowers need fair credit or above to qualify for a mortgage from the lender. But BofA does have options that can help low- to moderate-income borrowers, which could make it a good choice for those who may not have a large enough down payment to qualify for other mortgages.


Pros Explained

  • Existing customers may be eligible for discounts: Bank of America customers who are part of its Preferred Rewards program can qualify for reductions in mortgage origination fees or interest rate discounts. 
  • Mortgage options for low- and middle-income borrowers: Those with modest incomes can take advantage of Bank of America’s mortgage options that include low down payments and less-stringent credit requirements. The bank also offers down payment and closing cost assistance programs that may help borrowers become homeowners. 
  • Borrowers can pre-qualify and apply online: Unlike other lenders that require you to visit a mortgage advisor in person or speak to a representative over the phone, Bank of America gives borrowers the option of completing the pre-qualification and application processes entirely online. 
  • Offers loan options specifically designed for medical professionals: Bank of America provides mortgages tailored to the needs of medical professionals. Benefits include the ability to qualify for a loan before the start date of your new job and lower down payment requirements. Bank of America may also exclude some or all of your student loans from your total debt when calculating your loan eligibility.


Cons Explained

  • Limited information about lender fees: When shopping for a home loan it’s important to know what fees the lender charges. Although Bank of America has a closing cost calculator on its site, the information it provides is vague and doesn’t break down what fees are typically charged. 
  • Does not offer USDA or renovation loans: While Bank of America has several mortgage options, it doesn’t offer United States Department of Agriculture (USDA) loans—mortgages with 0% down payment requirements that can be used to buy homes in rural areas. The lender also doesn’t allow borrowers to take out renovation mortgages or loans to purchase and repair a fixer-upper. 
  • Does not offer alternative mortgages: Some mortgage lenders have loan options for individuals that may struggle to qualify for traditional mortgages, such as bank statement mortgages for self-employed borrowers. Unfortunately, Bank of America doesn’t have alternative mortgages available, so borrowers looking for that option will have to work with another lender. 

See a broader selection of mortgage lenders, including some offering USDA loans, in our picks for the best mortgage lenders available today.


Types of Mortgage Loans Offered by Bank of America

Bank of America has a wide range of mortgage options. While the lender doesn’t disclose its minimum credit score requirements for each loan type, most loans require borrowers to have a score of 620 or higher. Borrowers can choose from the following options: 

  • Fixed-rate mortgages: Bank of America’s fixed-rate loans are conventional mortgages with interest rates that stay the same for the duration of the loan term. 
  • Adjustable-rate mortgage (ARM): With an ARM, rates can change periodically over the life of the loan. They’re best for borrowers who want a lower initial monthly payment or who intend to stay in the house for just a few years. Bank of America’s ARM options include 5-year/6-month, 7-year/6-month, and 10-year/6-month. In these options, the first number refers to the initial period where the interest rate is fixed. The second number shows that the interest rate is adjusted every six months after that. 
  • Affordable Loan Solution mortgage: Modest-income homebuyers can use the Affordable Loan Solution program to buy a home with as little as 3% down. Loan amount maximums are $647,200 with a 3% down payment and up to $970,800 with a 5% down payment in high-cost areas. Mortgage insurance is required, but typically costs less than conventional mortgages. First-time homebuyers may need to complete a homebuyer education course from a qualifying agency. 
  • Jumbo loan: If the home you want to buy requires a larger loan than the conventional loan limit currently allows—$647,200 in all states except for Hawaii and Alaska and some designated high-cost markets—you need a jumbo mortgage. In general, jumbo mortgages have stricter eligibility requirements, so you will need good to excellent credit and a larger down payment. 
  • Federal Housing Administration (FHA) mortgage: FHA loans are backed by the government and have a lower down payment and credit score requirements.
  • U.S. Department of Veterans Affairs (VA) mortgage: Eligible U.S. military veterans may qualify for VA mortgages that offer up to 100% financing. Qualified borrowers can get a mortgage with $0 down, and the qualification guidelines are more flexible than those of conventional loans. 
  • Doctor mortgages: Licensed doctors, dentists, medical residents and fellows, and other medical professionals can qualify for Bank of America’s doctor mortgages. These loans have low down payment requirements—as low as 5% for mortgages up to $1 million and as low as 10% for mortgages up to $1.5 million—and the lender may exclude your student loans from your total debt when evaluating your loan application. Both residents and fellows can qualify for loans and close on a home 90 days before the start date of their job, an advantage over other lenders that require current pay stubs or other proof of employment. 


Bank of America Features and Benefits

Bank of America offers the following additional benefits: 

  • Existing relationship discounts: If you are an existing Bank of America customer or have a Merrill investment account, you may qualify for Bank of America’s Preferred Rewards program. Your tier level—based on your account balances—affects what benefits you’re eligible for, but they include $200 to $600 in reduced origination fees. 
  • America’s Home Grant: This program provides eligible borrowers with a credit worth up to $7,500 that can be used towards mortgage closing costs or to buy down the interest rate. 
  • Down Payment Grant: Moderate-income borrowers in select areas can qualify for the Down Payment Grant. Through this program, Bank of America provides borrowers with up to 3% of the home purchase price—up to a maximum of $10,000—to be used for a down payment. 

Visit Bank of America’s Down Payment Center: Bank of America maintains a database of state-run programs for modest-income and first-time homebuyers. You can search the Bank of America Down Payment Center to find programs that provide assistance with closing costs or your down payment.


How to Apply for a Bank of America Loan

If you decide that Bank of America is the right mortgage lender for you—or if you want to compare its rates with other lenders—follow these steps: 

  1. Decide how to apply: With Bank of America, you can apply for a loan in person or online. Bank of America offers a complete digital experience. In fact, the bank reported that 81% of its mortgage applications were initiated through its website or its mobile app.
  2. Gather documents: When you apply you’ll need to provide documentation to prove your income, employment, assets, and other details. Bank of America has a helpful checklist of required documents that can help you prepare. 
  3. Pre-qualify for a loan: To get a pre-qualification letter you can fill out a pre-qualification request online or at a local branch. If you’re an existing Bank of America customer, you can log in to your bank account to streamline the process, but you don’t need to be a customer to proceed. 
  4. Find a home: You can shop for a home on your own, or you can use Bank of America’s Real Estate Center to find local houses and even get connected to partner real estate brokers. 
  5. Apply for a mortgage: Once you find a home you love, you can make an offer and fill out an application for a mortgage. You’ll be asked to submit your documentation and consent to a credit check. If your application is approved, the lender will work with you to set a closing date. 

You may need to contact a specialist for information. Although Bank of America allows you to view potential rates, not all borrowers will be able to utilize that tool. Depending on your zip code, desired loan amount, and down payment, you may need to speak with a home loan specialist to get those details. 


Customer Service

Unlike some lenders, Bank of America doesn’t offer 24/7 support. However, you can reach customer service by phone, online chat, or by visiting a local branch. You can also schedule an appointment with a home loan advisor online to get personalized assistance. 

You can call (866) 467-6492 during the following business hours:

  • Monday through Friday: 8:00 a.m. until 10:00 p.m. EST 
  • Saturday: 8:00 a.m. until 6:30 p.m. EST


Customer Satisfaction

Bank of America is generally a well-respected lender. 

In the J.D. Power 2021 U.S. Primary Mortgage Origination Satisfaction Study, Bank of America was ranked 6th out of 23 lenders. The study evaluated each lender on its application and approval process, communication, loan closing, and loan offerings. 

However, individual customer reviews are less positive. On Trustpilot, Bank of America has a TrustScore of 1.3 out of five based on over 1,300 ratings. Trustpilot includes reviews for other Bank of America products, such as its bank accounts and credit cards, so not all negative reviews are about its mortgages. However, a recurring complaint was about long wait times contacting customer support and poor communication. 

Regulatory Actions

As one of the largest lenders in the country, it’s unsurprising that Bank of America has faced regulatory issues and lawsuits in the past. Notably: 

  • In 2022, the U.S. Department of Housing and Urban Development (HUD) approved an agreement with Bank of America to resolve allegations of discrimination against borrowers due to familial status and gender. 
  • In 2021, Bank of America agreed to pay $1.2 million in a class action lawsuit that claimed the lender participated in a mortgage kickback scheme in Maryland.
  • In 2015, the U.S. Securities and Exchange Commission (SEC) said that Bank of America had agreed to settle charges for defrauding shareholders and relying on an electronic mortgage registry in a settlement worth $335 million.

It’s not unusual for a company of Bank of America’s size to face these kinds of issues. However, be sure to do your own research on any lender you consider, keep good records, and read the fine print before signing any agreement. 


Account Management

Once you have taken out a mortgage, you can manage your account, make payments, and track your progress paying off your loan through Bank of America’s online portal. The company also has a robust mobile app you can use to manage your mortgage. 


Alternative Choices

Bank of America could be a good lender for first-time homebuyers and those with moderate incomes who could benefit from its low down payment options. However, the lender may not be the best choice for everyone. 

Another option to consider is Fairway Independent Mortgage Corporation. Unlike Bank of America, Fairway offers USDA loans for those looking to buy rural properties. Fairway also has renovation loans borrowers can use to purchase a property and pay for its repairs.

  Bank of America Fairway Independent Mortgage Corporation
Types of Mortgages Conventional FHA VA Jumbo Affordable Loan Solution Doctor loans  Conventional FHA VA USDA Jumbo Doctor loans Renovation
Average Time to Closing Not disclosed 30–45 days
2021 J.D. Power Ranking 6/23 5/23 


Choosing a Mortgage Lender

Before selecting a mortgage lender, it’s wise to shop around and compare loan options and rates from multiple sources. When evaluating your options, consider the following factors that can affect your total loan cost: 

  • Annual Percentage Rate (APR): The APR takes into account the interest rate, mortgage points, and broker fees associated with the mortgage. 
  • Loan Type: When you take out a mortgage, you can usually choose between fixed and adjustable-rate loans. Fixed-rate loans have interest rates that stay the same, while adjustable-rate loans can change over time. 
  • Repayment Term: Repayment terms generally range from 10 to 30 years. Shorter loan terms mean you’ll have a higher monthly payment, but you can get a lower interest rate if you choose a shorter term.
  • Points: Points are fees that you pay to the lender. Ask for the fees to be disclosed in dollars rather than points so you know exactly how much the loan will cost. 
  • Down Payment: With most mortgages, you’re required to put down a percentage of the home’s value from your savings. Depending on the type of mortgage you apply for, down payments can be as low as 3% or even 0%. However, keep in mind that you’ll likely have to pay for private mortgage insurance (PMI) if you put down less than 20%.

You can use Investopedia’s mortgage calculator to see how different rates and loan terms can affect your payments and overall repayment. 

Be aware of credit inquiry windows. When shopping for a mortgage, it’s a good idea to compare rates from several lenders. However, limit inquiries to a 30-day window to prevent damaging your score; FICO scores don’t include mortgage inquiries made within 30 days prior to calculating the score, so your rate research won’t hurt your chances of qualifying. After that, inquiries made within a short window are counted as a single inquiry.


Final Verdict

Bank of America customer reviews about its mortgage products are mixed; while some borrowers praise the company’s digital application process, there are several complaints about long wait times and unhelpful representatives when customers call for support. 

However, Bank of America is generally well-regarded in the industry by third-party consumer rating agencies like J.D. Power, and its digital mortgage experience makes it easy to apply for a mortgage from your couch. 

With that in mind, Bank of America is likely best for homebuyers who want to handle everything digitally, or those with modest incomes who want to take advantage of the lender’s homebuyer assistance and Affordable Loan Solution programs.


How We Review Motgage Lenders

Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of mortgage lenders. We rated 45 mortgage lenders and collected nearly 1,500 data points, including information about the following:

  • Quality of service (customer experience, online applications, benefits/grants, etc.)
  • Operational features (state licensing coverage, number of loan officers, etc.)
  • Loan types offered (fixed-rate, FHA, USDA, etc.)
  • Accessibility (days to closing, minimum debt-to-income ratio, etc.)

We also conducted a survey of 1,195 mortgage borrowers to learn about the most important features from a customer perspective and how satisfied customers are with various lenders. Mortgage lenders were rated objectively in the categories above to help readers make informed decisions about home loans.

Read more in our full mortgage lender review methodology.


Related Posts