Bank of America Mortgage Review 2020

Good for: first-time home buyers looking for low-down-payment options and existing customers who may get a discount on fees.

NerdWalletJune 30, 2020

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Our Take

5.0

NerdWallet rating 

The bottom line: Bank of America offers many loan options, easily viewed rates, extensive online capabilities and competitive rates and fees.

Best Mortgage Lender for First-Time Home Buyers, Best Mortgage Lender for Online Loans

Bank of America

Bank of America: NMLS#399802

Min. Credit Score

620

Min. Down Payment

3%

Loan Types and Products

Purchase, Refinance, Home Equity, Jumbo, Fixed, Adjustable, FHA, VA

Pros & Cons

Pros

  • Allows borrowers to apply entirely online.

  • Offers down payment and closing cost assistance programs.

  • May give existing customers a discount on mortgage lender origination fees.

Cons

  • Doesn't offer renovation loans.

Compare to Other Lenders

Min. Credit Score

700

Min. Credit Score

620

Min. Down Payment

3%

Min. Down Payment

3%

National / Regional

National

National / Regional

National

Loan Types and Products

Purchase, Refinance, Home Equity, Reverse, Jumbo, Fixed, Adjustable, FHA, VA, USDA

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable

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Full Review

Due to the coronavirus pandemic, getting a mortgage may be a bit of a challenge. Lenders are dealing with high loan demand and staffing issues that may slow down the process. Also, some lenders have increased their fees or temporarily suspended certain loan products. If you can’t pay your current home loan, refer to our mortgage assistance resource. For the latest information on how to cope with financial stress during this pandemic, see NerdWallet’s financial guide to COVID-19.

Bank of America at a glance

Bank of America has many loan options, including geographically targeted programs that can be especially helpful for low- and moderate-income home buyers. Online convenience and relatively low rates and fees are also pluses for this lender.

Here's a breakdown of Bank of America's overall score:

  • Variety of loan types: 5 of 5 stars

  • Variety of loan products: 4 of 5 stars

  • Online convenience: 5 of 5 stars

  • Rates and fees: 4.5 of 5 stars

  • Rate transparency: 5 of 5 stars

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, 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 of centralized and online sales.

Here's how Bank of America's mortgage offerings stack up.

Bank of America mortgage loan types and products

The Charlotte, North Carolina-based lender offers a wide range of purchase and refinance loans, including 15-, 20- and 30-year fixed-rate loans and adjustable-rate mortgages with 5/1, 7/1 and 10/1 terms. It also issues jumbo loans up to $2.5 million and government-insured mortgage products such as Federal Housing Administration (FHA) and Veterans Affairs (VA) loans.

Bank of America’s Community Homeownership Commitment is designed to make homeownership more affordable for first-time and low- to moderate-income home buyers in communities across the country. The program offers:

  • Up to $10,000 in down payment assistance in select cities.

  • Up to $7,500 for nonrecurring closing expenses like title insurance and recording fees available in some parts of the country.

  • Two mortgage products with 3% minimum down payments: the Affordable Loan Solution mortgage and the Freddie Mac Home Possible mortgage.

Bank of America mortgage online convenience

Bank of America’s digital mortgage experience allows you to apply, get pre-qualified or preapproved and lock your interest rate online through its website or mobile app. If you’re already a banking customer, the digital application will auto-populate with your contact information and financial data, reducing the time it takes to apply. If you prefer to apply over the phone or in person at a Bank of America branch, those options exist as well.

Bank of America’s Home Loan Navigator portal helps borrowers stay plugged in throughout the lending process. You can upload documents, download loan disclosures, track the progress of your loan and e-sign required paperwork.

Bank of America mortgage rates and fees

If you’re already a Bank of America customer, you may qualify for a reduction of up to $600 in the mortgage lender origination fee.

One of the most important considerations when choosing a mortgage lender is understanding what the loan will cost. In order to provide consumers with a general sense of what a lender might charge, NerdWallet scores lenders on two factors regarding fees and mortgage rates:

  • A lender's average origination fee compared with the median of all lenders reporting under the Home Mortgage Disclosure Act. Bank of America earns 4 out of 5 stars on this factor.

  • A lender's offered mortgage rates compared with the best available on comparable loans. Bank of America earns 5 out of 5 stars on this factor.

Borrowers should consider the balance between lender fees and mortgage rates. While it's not always the case, paying upfront fees can lower your mortgage interest rate. Some lenders will charge higher upfront fees to lower their advertised interest rate and make it more attractive. Some lenders just charge higher upfront fees.

You can decide to buy discount points — a fee paid with your closing costs — to reduce your mortgage rate.

Deciding whether to pay higher upfront fees is a matter of considering how long you plan to live in your home and how much cash you have to apply toward closing costs when you sign the loan paperwork.

Bank of America mortgage rate transparency

The lender’s website displays interest rates for several of its fixed- and adjustable-rate mortgage products, along with the annual percentage rate, any discount point assumptions and an estimated monthly payment. You can enter your purchase price, down payment and ZIP code to see more customized rates.

NerdWallet’s star ratings for mortgage lenders are awarded based on our evaluation of the products and services each lender offers to consumers who are actively shopping for the best mortgage. The five key areas we evaluated include the variety of loan types and products offered, online conveniences, online mortgage rate information, and the rate spread and origination fee lenders reported in the latest available Home Mortgage Disclosure Act data. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.