Bank of America
Bank of America is one of the world’s largest financial services companies. A full-service consumer, commercial and investment bank, it is the nation’s second-largest mortgage lender and servicer, as well as the second-largest U.S. bank in terms of assets (2011 figures). With nearly 6,000 retail branches nationwide, it offers a full range of savings, checking, investment and loan products, serving some 57 million consumers and small business customers.
Bank of America traces its roots back to 1784 and the founding of the Massachusetts Bank, the nation’s third commercial bank, whose charter was signed by John Hancock. Since then, and through a series of acquisitions, Bank of America has changed and grown to what it is today. Recent acquisitions include credit card giant MBNA in 2005; Countrywide Financial in 2007, at the time the nation’s largest mortgage servicer; and Merrill Lynch in 2008, giving the company a major presence in wealth management and investment banking.
Bank of America Mortgages
Bank of America offers a variety of mortgage products, including fixed-rate loans in terms of 10 to 40 years, typically in five-year intervals. Adjustable-rate mortgages (ARMs) are available with initial terms ranging from one to 10 years before the loan resets to a new rate. Mortgage rates are competitive with other industry leaders.
Bank of America is an authorized lender for both FHA and VA mortgages, which feature lower down payment requirements and more flexible credit and income guidelines than on conventional mortgages. Both are popular options for qualifying first-time homebuyers. Jumbo mortgages are available for loans exceeding conforming loan limits set by Fannie Mae and Freddie Mac, which are $417,000 in most of the country and as high as $625,500 in high-value areas.
The company offers a variety of specialized home financing options to meet borrower’s needs. Among these are several affordable housing programs that Bank of America participates in that provide down payment and closing cost assistance. Some of these are employer-based; others are operated by local and state housing agencies for borrowers of limited means.
Other specialized products are available for more upscale borrowers. Interest-only mortgages are still available for qualified borrowers, though rates are higher than on conventional mortgages. These may be desirable for borrowers with variable sources of income or who are not planning to remain in the home for a long time.
On jumbo mortgages, Bank of America promotes a combo loan option which allows a borrower to take out a smaller, conforming mortgage at a lower rate, supplemented by a home equity loan second mortgage to cover the rest of the balance. This enables a borrower to avoid paying the higher, jumbo loan rate on the entire balance.
Mortgage applications may be initiated at any Bank of America branch, or through their web site at bankofamerica.com or by calling their toll-free number.
Bank of America refinancing options are comparable to their standard mortgage products. Fixed, adjustable, jumbo, FHA and VA loans are all available to consumers for refinancing options. Of particular interest to refinancing borrowers, Bank of America offers nonstandard repayment terms on fixed-rate loans, such as 25 years, for borrowers who wish to stay close to their current amortization schedule.
Refinancing rates will be based on the available equity in the home, credit history, mortgage payment history, employment and the type of loan applied for at the time. Cash-out and debt consolidation refinancing options are available to borrowers with sufficient home equity. Refinance rates are comparable to those on purchase mortgages with the same terms.
Current Bank of America mortgage customers who have little home equity or owe more than their home is worth (i.e., are underwater on their mortgage) may be able to refinance through the Home Affordable Refinance Program if their mortgage is backed by Fannie Mae or Freddie Mac. For non-Fannie or Freddie mortgages, Bank of America is offering enhanced mortgage refinancing and loan modification assistance under the terms of a settlement with state and federal officials over foreclosure practices.
Home Equity Loans
Bank of America offers both a Home Equity Loan program as well as a Home Equity Line of Credit (HELOC) program. Both are loans with the equity in your home serving as collateral and are considered second mortgages.
With a Bank of America home equity loan, you borrow a single lump sum of cash to be repaid as a fixed-rate loan with a repayment term ranging from three to 25 years. The amount borrowed can range from a minimum of $10,000 to a maximum of $500,000 ($100,000 on a second or vacation home). Interest rates are somewhat higher than on a primary fixed-rate mortgage.
A HELOC establishes a line of credit secured by the equity in your home that you can borrow against as needed. Interest rates are variable but lower than on a standard home equity loan, though you may convert to a fixed-rate option to repay funds borrowed. You only pay interest on the funds you have actually borrowed. Credit provided under a Bank of America HELOC ranges from a minimum of $25,000 to a maximum of $500,000 ($100,000 for second or vacation home). There is a 10-year term during which you may draw upon the account, followed by a 15-year repayment period.
Bank of America does not charge closing costs or application fees on either type of home equity product.
Borrowers may initiate mortgage, refinance or home equity loans through any Bank of America branch or through their web site at www.bankofamerica.com
Further information on home loan products may be obtained by calling 1-888-683-6405. Existing customers seeking information on home equity loans should call 1-800-934-5626; California customers call 1-800-621-1044.