Bank of America Mortgage Review

Homebuyers looking for variety of options and competitive rates through a trusted lender may want to consider Bank of America as their lending partner.

J.D. Power Rating
3/5
Min. Credit
620
Min. Down Payment
3%
SimpleScore
3.8 / 5.0
close
SimpleScore Bank of America 3.8
Perks 5
Credit Impact 3
Customer Satisfaction 3
Product Variety 4
Fees 4

Founded originally in 1904, Bank of America currently has its headquarters in Charlotte, North Carolina. As the second-largest bank in the U.S. by assets, Bank of America is well equipped to handle all of your borrowing needs, including mortgages. Bank of America mortgage loans are available in many variations, including FHA, VA, ARMs — 5, 7 and 10 year — and fixed-rate — 15, 20 and 30 year — options. The bank also offers some affordable housing assistance programs, including down payment grants and low down payment options.

In this article

    Bank of America at a glance

    LenderMin-Max Loan AmountAPR RangeTermsKey Benefit
    Bank of AmericaN/A3.095% — 3.757%15 – 30 yearsDown payment grant assistance available

    What we like about it

    When it comes to mortgages, there’s quite a bit to like about Bank of America, especially as an all-around solution. First, the bank offers several different types of loans. The variety helps to accommodate different types of customers who are looking to meet different borrowing needs. The bank may not have the lowest interest rates in the industry, but the rates are competitive and backed by one of the largest banks in the country.

    On top of this, Bank of America offers affordable home-buying solutions to help people who are financially straddling the line between approval and non-approval reach their dreams. Buyers looking for a little help should check out the America’s Home Grant program and the Down Payment Grant Program. Additionally, the Affordable Loan Solution mortgage offers a competitive fixed-rate loan with as little as 3% down.

    Things to consider

    While the APR rates listed by Bank of America are attractive, it’s important to understand that these are the rates given to the borrowers with the highest quality credit profiles. If your credit is not the best, you may not qualify for the lowest rates. This is standard across the industry, but is also something to be aware of.

    Borrowers looking for shorter and more aggressive 10-year mortgages will not be able to get them through Bank of America. The bank does offer the less popular 20-year option as well as a 15-year option, but not the 10-year option. If you are planning on staying in your home for less than 10 years, you can look into the 10-year ARM option, which currently has APR rates as low as 3.757%. Just make sure you understand how adjustable-rate mortgages work after the fixed-interest period.

    What you need to know

    Bank of America home loans are available from 15- to 30-year terms. Borrowers can get loans of different variations, including FHA, VA, adjustable-rate, fixed-rate and jumbo. APRs start between 3.095% — 3.757%, depending on the type of loan you choose. The actual rates you are approved for will depend on your credit profile, the type of loan, what the purchase is for and the size of the loan. You can apply for a Bank of America mortgage loan online, over the phone or at a local branch location.

    Fees and penalties

    Bank of America does not publicly discuss the fees and penalties charged on its loans. However, the lender does have a closing cost calculator to help you estimate the costs you’ll be charged. Typically, these costs span from 2% to 5% of the total size of the mortgage.

    How to apply for a Bank of America mortgage loan

    1. Collect the documents you need to apply.

    If you are just looking for prequalification, you’ll only need your basic information, address, estimated income and estimated monthly debt. People looking to fully apply for a mortgage loan will need more. You’ll need income statements, tax documents, pay stubs, asset information and any other financial documents you have that may be pertinent to the lender.

    2. Get prequalified.

    Bank of America offers a prequalification process online that takes five minutes. This is not an official approval, but it will give you a general idea of the rates that you may be approved for. This step doesn’t have to be completed before filling out a full application, but it may be beneficial.

    3. Complete your application.

    You can apply for a loan online, in person or over the phone. The preferred method is online, as the bank has greatly streamlined the process. The Home Loan Navigator helps you to track your loan and sign and submit documents in one place quickly and efficiently.

    Alternatives to Bank of America mortgages

    Better.com

    Best for online lending.

    J.D. Power Rating
    N/A
    Min. Credit
    620
    Min. Down Payment
    3%
    SimpleScore
    3.8 / 5.0
    close
    SimpleScore Better Mortgage Company 3.8
    Perks 2
    Credit Impact 5
    Customer Satisfaction N/A
    Product Variety 3
    Fees 5

    Better.com is redefining the homeownership process from the ground up. They say they’re using technology to make it faster and more efficient, and humans to help make it friendly and enjoyable.

    • On the other end of the spectrum from the big-box solutions like of Bank of America is Better.com, a fully online lender. The company offers very competitive rates that are updated on the website every minute. Depending on your exact situation, rates may be better with either company.
    • With Better.com, you can easily see and compare rates without creating an account or filling out any documentation. Bank of America does show rates on some, but not all, of its mortgage products. Additionally, the rates are updated daily and not minute by minute. Borrowers looking for a more streamlined, technologically driven solution, may find more success with Better.com as a lender.

    Chase Bank

    The bank offers a full array of mortgage products including fixed-rate mortgages, ARMs, jumbos, VA loans and FHA loans.

    J.D. Power Rating
    3/5
    Min. Credit
    620
    Min. Down Payment
    3%
    SimpleScore
    3.8 / 5.0
    close
    SimpleScore Chase 3.8
    Perks 4
    Credit Impact 4
    Customer Satisfaction 3
    Product Variety 5
    Fees 3

    Founded in the late 1800s as Chase National Bank, Chase operates under JPMorgan Chase with headquarters in New York, NY. Business Insider notes that JPMorgan Chase is currently the largest bank in the U.S. when ranked by assets with $2.74 trillion on the books.

    • While Chase Bank does have limited mortgage options advertised, the company’s rates are nothing to scoff at. Bank of America takes the cake with the adjustable-rate mortgage, but Chase has better fixed rates. When it comes to educating yourself about the process, Chase is the more helpful option. The bank’s mortgage learning center is packed with guides and articles to bring buyers up to speed. Bank of America does have some resources and FAQs, but nowhere near as extensive as Chase.

    Caliber Home Loans

    Caliber Home Loans has a large selection of mortgages, but its lack of transparency about its rates makes it a better fit for serious customers rather than for those just shopping around.

    J.D. Power Rating
    2/5
    Min. Credit
    620
    Min. Down Payment
    3%
    SimpleScore
    3.8 / 5.0
    close
    SimpleScore Caliber 3.8
    Perks 5
    Credit Impact 4
    Customer Satisfaction 2
    Product Variety 5
    Fees 3

    In addition to all the common types of home loans — conventional, Jumbo, FHA, VA, USDA — Caliber Home Loans also offers its own portfolio of options, including several geared toward borrowers who have been denied traditional financing or have bad credit.

    • With over $150 billion in loans served, Caliber Home Loans is not a small fish in a big pond. Based in Coppell, Texas, this lender services borrowers nationwide and offers borrowers a very personal touch to the lending process. If you’re new to buying a home and want the hands-on approach as opposed to the big-box feel of Bank of America, you may enjoy Caliber Home Loans. Loans are available up to $3 million, with the ability to finance a home purchase, new build, second home or investment property. The downside is that Caliber Home Loans is not a bank, so you won’t be able to get any preferred customer discounts like you might be able to with Bank of America.

    Compare top mortgage lenders

    Methodology

    SimpleScore

    We’ve created the SimpleScore to help you objectively compare products and services here at The Simple Dollar.

    Our editorial team:

    • Identifies five factors to compare across each brand
    • Determines the rating criteria for each factor
    • Calculate an average of those five factor scores to get one SimpleScore

    We break down each of these five factors and their rating criteria for our review of the best mortgage companies.

    Why do some brands have different SimpleScores on different pages?

    Some brands like Bank of America, Wells Fargo, and Chase have different SimpleScores because they offer more than one financial solution — like home loans, auto loans, personal loans and more.

    For instance, in our Bank of America Mortgage Review, we give the company a 3.8 out 5 based on our five rating factors for mortgages. In our Bank of America Auto Loans Review, we give the company a 4.4 out of 5 based on our rating factors for auto loans. By tailoring our SimpleScore to each financial solution, we’re able to give you a more accurate view of a brand’s services and how it compares to competitors’ services.

    Perks

    Mortgage lending companies that provide more perks receive a higher score from us.

    Hard/Soft credit checks

    We know that credit checks affect your score –– that’s why we favor companies that offer soft credit checks or hard credit checks when you want to see your pre-approval rates.

    Customer satisfaction

    We use the J.D. Power 2019 Mortgage Origination Satisfaction Study℠ to find out how customers rate their experience with each company. (If a company is not included in J.D. Power’s study, we skip this rating factor and average the remaining factor scores.)

    Product variety

    Mortgage lenders that offer more products for their home loans are given higher scores.

    Fees

    Fees can add up fast. Companies that don’t require as many fees for your home loan receive a higher score with us.

    Jason Lee

    Contributing Writer

    Jason Lee is a U.S.-based freelance writer with a passion for writing about dating, banking, tech, personal growth, food and personal finance. As a business owner, relationship strategist, and officer in the U.S. military, Jason enjoys sharing his unique knowledge base and skill sets with the rest of the world. Follow Jason on Facebook here