It’s one of the largest banks in the world, but Bank of America doesn’t want to be known just for its mammoth size. Then again, being one of the biggest does have its advantages, especially in mortgage lending.
Bank of America provides multiple loan options, competitive mortgage rates, high-tech customer service and a step-by-step walk-through of the underwriting process as it works to make getting a mortgage easier, says John Schleck, senior vice president for centralized and online lending.
Let’s take a look at how Bank of America Mortgage stacks up.
AT A GLANCE
- Offers 15- and 30-year fixed loans, FHA, VA, home equity and refinance loans.
- Offers 5/1, 7/1 and 10/1 ARMs.
- Minimum credit score: 620 (FHA: 600).
Bank of America mortgage products
The Charlotte, North Carolina-based lender offers a wide range of purchase and refinance loans, including 15- and 30-year fixed-rate loans and adjustable-rate mortgages with 5/1, 7/1 and 10/1 terms. It also issues jumbo loans and government-insured products such as Federal Housing Administration and Veterans Affairs loans.
Seeking to appeal to cash-strapped home buyers who don’t fit into the conventional lending box, Bank of America began offering its own low-down-payment mortgage earlier this year. The Affordable Loan Solution mortgage requires a down payment of just 3% and no mortgage insurance premium.
Another loan product is tailored to doctors who may be short on cash for a down payment but who have strong earnings potential, Schleck says. This program allows borrowers to put down just 5% and has no mortgage insurance requirement.
Bank of America offers loans up to $5 million. If you’re already a bank customer, you may qualify for a reduction of $200 to $600 in the mortgage lender origination fee.
Earlier this year, Bank of America launched Home Loan Navigator, an online mortgage portal that allows you to stay plugged in throughout the lending process, via desktop or mobile app. After an initial consultation with a loan officer, you can create an account and upload documents, download loan disclosures, track the progress of your loan and e-sign paperwork.
The bank also offers in-house video conferencing with loan officers at 700 of its branches if one isn’t on site, Schleck says.
Convenience and options
When you apply for a Bank of America mortgage or refinance, you have many options: in person at a local branch, by phone, scheduling an appointment online for phone or in-person consultations, or online through its pre-qualification tool.
“We know our clients have the ability to go online and learn more information than ever,” Schleck says. “Many of them still need professional advice to sift through all the stuff out there.”
The lender also is now accepting alternative credit data such as utility and rent payments for some of its loan products — a major departure from the traditional underwriting model. This shift represents a new a “holistic picture” approach toward clients’ finances, Schleck says.
What Bank of America does best
- Offers a full suite of online and mobile tools to borrowers.
- Has a wide array of mortgage purchase and refinance products to meet virtually any financial need.
- Provides its own 97% loan-to-value first-time home buyer loan with no mandatory mortgage insurance, as well as a similar program for doctors.
Where Bank of America falls short
- In online consumer complaints, customers report delayed closings, slow processing times and inconsistent communication.
- It offers its own products and rates only, which may or may not have the best terms for your situation.
- As one of the largest banks in the world, it’s often involved in high-profile litigation costing billions of dollars — costs it could pass on to customers in the form of higher fees and interest rates.
If you’re looking for a straightforward mortgage product and already have accounts with Bank of America, you’re likely to find what you’re looking for in the same place. Keep in mind, though, that the rates and products you’ll be offered are just from Bank of America; shop around with a few other lenders to ensure you’re getting the best deal.
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NerdWallet’s star ratings for mortgage lenders are awarded based on our evaluation of the products and services that lenders offer to consumers who are actively shopping for the best mortgage. The six key areas we evaluated include the loan types and loan products offered, online capabilities, online mortgage rate information, customer service and the number of complaints filed with the Consumer Financial Protection Bureau as a percentage of loans issued. We also awarded lenders up to one bonus star for a unique program or borrower focus that set them apart from other lenders. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.