Bank of America Mortgage Review 2022

Bank of America offers mortgages in addition to its checking, savings and credit card products. Bank of America has a variety of mortgage products to suit your needs, whether you are a first time homebuyer looking for an affordable jumbo home loan or a home buyer in search of a larger home.

Borrowers with fair or better credit will be eligible for mortgages from most lenders. BofA offers mortgages for low-to-moderate-income people. This could be a great option for those without a substantial down payment.

Pros Explained

• Customers who have been with Bank of America for a while may qualify for a discount.
• Options for mortgages with low and moderate incomes: Those who earn modestly can benefit from Bank of America’s options, which include lower down payments and fewer credit requirements. Bank of America offers programs to help with down payments and closing costs.
• Online prequalification is available for borrowers. Unlike some lenders, Bank of America allows borrowers to complete the entire prequalification process online.
• Bank of America offers mortgages that are tailored for the medical profession. The ability to get a mortgage before your start date at a new job, and the lower requirements for down payments are some of the benefits. Bank of America can also subtract some or all of the student loan debt from your total amount owed when calculating eligibility for a loan.

The Cons of Buying a Home

• Lack of information on lender fees. When shopping for home loans, it is important to be aware of the fees charged by lenders. Bank of America’s site has a calculator for closing costs, but the data is not specific and does not break out what types of fees they charge.
• Doesn’t offer USDA loans or loans for renovations: While Bank of America offers several mortgage products, they don’t provide United States Department of Agriculture loans (USDA loans), which are loans with no down payment required that can be applied to purchase homes in rural regions. Bank of America does not allow its borrowers to get renovation loans or to buy and fix up a fixer upper.
• Doesn’t offer alternative mortgagesSome lenders provide loan options to individuals who may have difficulty qualifying for conventional mortgages. For example, bank statement mortgages are available for self-employed people. Bank of America does not offer alternative mortgages, and borrowers who are looking for this option must find another lender.

Bank of America offers a variety of mortgage loans

Bank of America offers a variety of mortgage products. The lender does not disclose the minimum credit scores required for different loan types, but most require that borrowers have at least 620. The following are the options available to borrowers:

• Fixed rate mortgages. Bank of America fixed-rate loans have interest rates which remain the same throughout the term of the loan.
• Mortgage with adjustable rate (ARM) With an ARM the rates may change over time. These are best for those who plan to live in their home for only a short time or want a low initial payment. Bank of America offers ARMs with terms of 5-year/6 months, 7-year/6 months, and 10-year/6 month. The first number in these options refers to initial periods where interest rates are fixed. After the initial period, interest rates are adjusted every six-months.
• Mortgage Affordable Loan Solution:Modest income homebuyers may use the program Affordable Loan Solution to purchase a house with only 3% of their earnings. The maximum loan amount is $647,200 for a downpayment of 3% and $970,800 in areas with high costs. It is necessary to purchase mortgage insurance, which costs typically less than traditional mortgages. Homebuyers who are first-time buyers may be required to take a course on homebuyer’s education from an agency that qualifies.
• Jumbo Loan: If the house you’re looking to purchase requires a bigger loan than what the current conventional loan limits are – $647,200 for all states with the exception of Hawaii and Alaska as well as some high-cost areas – then you need a Jumbo Mortgage. Jumbo mortgages are more difficult to qualify for, and require a higher down payment.
• Federal Housing Administration mortgage (FHA).FHA is backed by government, and has a low down payment requirement and better credit requirements.
• U.S. Department of Veterans Affairs mortgage: U.S. veterans who are eligible may be able to qualify for VA loans that provide up to 100 percent financing. The guidelines for qualifying borrowers are flexible and allow them to get a mortgage without putting any money down.
• Mortgages for doctors:Licensed physicians, dentists and medical trainees and residents, as well as other medical professionals, can be eligible to apply for Bank of America doctor mortgages. The down payments for these loans are low – as little as 5% on mortgages of up to $1,000,000 and 10% for those up to $1.5,000,000. Your student loan debt may be excluded from the total amount you owe when your application is evaluated. Residents and fellows are eligible for home loans, and can close 90 days prior to the beginning of their new job. This is an advantage over lenders who require pay stubs and other forms of proof of employment.

Bank of America Features and Benefits

Bank of America provides the following benefits as an additional benefit:

• Discounts for existing relationships: As an existing Bank of America client or Merrill account holder, you could qualify for Bank of America Preferred Rewards. The benefits that you are eligible for depend on the tiers of your accounts. However, they can range from $200-$600.
• America’s Home Grant: The program offers eligible borrowers a credit of up to $7500 which can be applied to mortgage closing costs, or used to lower the rate.
• Grant for Down Payment:Moderate income borrowers can apply to the Grant for Down Payment. Bank of America offers borrowers up to $10,000 or 3% of their home’s purchase price through this program.

How to apply for a Bank of America loan

Follow these steps if you’ve decided that Bank of America will be the best mortgage lender for your needs, or if you wish to compare their rates with those of other lenders:

1. Choose how you want to apply. With Bank of America, it’s possible to apply in person or on-line. Bank of America provides a digitally integrated experience. The bank has reported that 81 percent of mortgage applications are initiated via its website and mobile app.
2. Collect documents: When you apply, you will need to submit documentation that proves your employment, income, assets and more. Bank of America provides a handy checklist of documents you’ll need to prepare.
3. To prequalify for a mortgage: You can either fill out an online prequalification form or visit a branch to get one. Logging into your Bank of America account will streamline the application process. You don’t have to be an existing customer.
4. Find your home:You may shop on your own or use Bank of America’s Real Estate Center. You can even connect with real estate agents.
5. Fill out a mortgage application: Once you have found a house you like, you may make an offer. Your documentation will be requested, and you’ll have to consent to the credit check. The lender will set up a date for the closing if your application is accepted.

Customer Service

Bank of America does not offer 24/7 customer service. You can contact customer service via phone, live chat or visiting your local branch . To get personalized help, you can schedule an online appointment with a mortgage advisor.

You can reach us at (866) 467 6492 between the hours of:

• From Monday to Friday : 8 a.m. till 10 p.m.
• Sunday: 8 a.m. to 6:30 p.m.

Customer satisfaction

Bank of America has a good reputation.

J.D. Power 2021 U.S. Primary Mortgage Origination Satisfaction Study, Bank of America was ranked 6th out 23 lenders. Bank of America ranked sixth out of 23 lenders in the J.D. This study evaluated lenders on their application and approval processes, communication, loans closings, and lending offerings.

Individual customer reviews, however, are not as positive. Bank of America’s TrustScore on Trustpilot is 1.3 out of 5 based upon over 1,300 reviews. Bank of America’s mortgages are not the only products reviewed on Trustpilot. It also includes other Bank of America services, like its credit cards and bank accounts. A recurring complaint, however, was the long wait time to contact customer service and poor communication.

Regulations

It’s not surprising that Bank of America, as one of the nation’s largest banks, has been involved in regulatory problems and lawsuits. Notably:

• The U.S. Department of Housing and Urban Development approved a deal with Bank of America in 2022 to settle allegations of discrimination based on gender and familial status against certain borrowers.
• Bank of America has agreed to pay $1.2m in 2021 in response to a lawsuit alleging that the lender was involved in an illegal mortgage kickback in Maryland.
• The U.S. Securities and Exchange Commission announced in 2015 that Bank of America agreed to pay $335 million as part of a settlement for defrauding investors and using an electronic mortgage database.

Bank of America is not the only company of this size that faces these issues. Do your research, maintain good records and make sure you read all the fine print.

Account Management

Bank of America offers an online portal where you can track the progress of your mortgage repayment, manage your account and make payments. You can also manage your mortgage using the company’s mobile app.

Alternative Choices

Bank of America is a great lender for those who are first time home buyers and have a moderate income. They could also benefit from the low-down payment options. The lender is not the right choice for all.

Fairway Independent Mortgage Corporation is another option. Fairway, unlike Bank of America offers USDA loans to those who are looking for rural property. Fairway offers renovation loans that borrowers can take out to buy a home and make repairs.