Bank of America HELOC Review 2024
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Our Take
4.5
Bank of America’s HELOC stands out for offering multiple types of rate discounts, especially for current Bank of America customers. Its fixed-rate option can help keep payments predictable. This HELOC has a maximum line amount of $1 million. Bank of America has no application fee, annual fee or closing costs, but it does charge an early termination fee for most accounts closed within 36 months.
Pros
- Charges no annual fee, application fee or closing costs.
- Publishes sample HELOC rates online.
- Offers multiple discounts, including autopay discount when using a Bank of America account.
Cons
- Charges an early account closure fee.
- Fined $12 million in 2023 for reporting inaccurate mortgage applicant info to the federal government.
Lender | Max. loan amount | Max LTV | Min. credit score | |
|---|---|---|---|---|
$400,000 | 85% | 640 | Visit Lenderat Figure at Figure | |
$750,000 | 80% | 580 | Visit Lenderat New American Funding at New American Funding | |
$1,000,000 | 85% | 670 | Visit Lenderat Bethpage Federal Credit Union at Bethpage Federal Credit Union |
Full Review
Bank of America HELOC rates and discounts
Most home equity line of credit, or HELOC, interest rates are indexed to a base rate called the prime rate. The annual percentage rate, or APR, that you’re offered will include a margin the lender has added to the prime rate. These margins depend largely on factors like your credit score, your existing debt and the amount you wish to borrow, but they will vary by lender.
Current prime rate | Prime rate last week | Prime rate in the past year — low | Prime rate in the past year — high |
|---|---|---|---|
7.75% | 8% | 7.75% | 8.50% |
Bank of America publishes sample HELOC rates on its website, and the rate you see may vary from state to state. On the day we checked rates for borrowers in California, the lender advertised a short-term promotion for a 6-month introductory rate, followed by a 9.4% variable APR. The sample APR assumes a $100,000 line of credit for a borrower with excellent credit, and includes two types of rate discounts.
Bank of America offers a HELOC rate discount for:
Borrowers who set up automatic payments from certain Bank of America accounts.
Borrowers who make an initial withdrawal when they open their accounts.
Borrowers who are members of Bank of America’s Preferred Rewards program.
Bank of America allows borrowers to convert their variable-rate balance to a fixed rate without a fee.
Applying for a Bank of America HELOC
Borrowers can apply for a HELOC online in a process the lender says takes about 15 minutes to complete. Online chat with a live agent automatically pops up while you’re browsing the website — a helpful feature that makes it easy to ask a quick question. When we tried it, it took only a minute to connect with an agent who answered our question quickly.
Borrowers also have the option to apply for a HELOC over the phone. You can schedule an appointment on the website to receive a call from a loan advisor. You can also apply in person at a Bank of America branch. The website includes an interactive map where you can see nearby branches that have a home loans specialist available.
To apply for a HELOC online, by phone or in person, you’ll need to supply some personal information as well as income data and financial and tax details about your home. HELOC information pages on the lender’s website include FAQs about how the line of credit works and what borrowers can expect once approved.
Opening and using a Bank of America HELOC
Bank of America says the whole process, from application to closing, can be completed online. This HELOC has a maximum line amount of $1 million and a maximum combined loan to value ratio of 85%, slightly higher than we see at most lenders. Once approved, borrowers can access HELOC funds for 10 years in several ways:
Transferred to a Bank of America account.
By check.
Through a Visa card.
In person at a bank branch.
Through online or mobile banking, as a payment option for bills linked through online bill pay.
Borrowers can repay the line of credit for up to 20 years by transferring funds online, setting up automatic bill payments or visiting a branch location. And though a discount is available for making a draw when the account is opened, an initial draw is not required, so you aren’t taking out cash you don’t need right away.
Bank of America’s HELOC has no application fee, annual fee or closing costs. The lender does not charge a fee for paying off the balance early but does charge a fee for terminating the account within 36 months of opening it.
» MORE: Best HELOC lenders
Bank of America and consumer trust
Bank of America paid a $12 million fine in November 2023 for incorrectly collecting, recording and reporting required demographic data to the federal government. Accurate reporting allows regulators to monitor fair lending practices in the mortgage industry.
In agreeing to the civil penalty, the lender neither admitted nor denied wrongdoing.
A lender’s NerdWallet star rating for HELOCs is negatively affected by recent regulatory actions for violations that harmed mortgage customers. In an email, Bank of America said that it notified the government after receiving one complaint in 2020 and conducting a review. In 2020 and 2021, Bank of America took additional steps to enhance employee monitoring and training about asking applicants for required racial, ethnic and gender information.
Alternatives to a Bank of America HELOC
U.S. Bank also offers preferred rate discounts to its banking customers. TD Bank also has a fixed-rate repayment option.
HELOCs offer a flexible way to access home equity over a period of time and pay interest only on the funds you withdraw. However, rising interest rates can bump up your monthly payment, and, as with credit cards, it takes discipline to avoid overspending.
Alternatives to home equity lines of credit include a home equity loan, which offers a lump sum with a fixed rate or a cash-out refinance, which replaces your existing mortgage with a larger loan.
Bank of America offers cash-out refinance loans, but does not offer home equity loans.
NerdWallet’s HELOC star ratings are awarded by the editorial team based on the following evaluated factors: HELOC volume, combined loan-to-value ratio, whether a fixed-rate option is available, lender fees, initial draw requirements, flexibility of draw and repayment terms, digital application availability, customer support options and transparency to consumers on key factors. A recent regulatory action against a lender may affect its HELOC star rating.
