Bank Of America First Time Home Buyer

Bank Of America First Time Home Buyer – Pedestrians walk past a Bank of America ATM on January 23, 2020 in San Francisco. Alex Tai/LightRocket via Getty Images

Bank of America says it is now offering no-cost, no-closure mortgages to first-time home buyers in select neighborhoods to help increase homeownership among black and Hispanic/Latino communities. .

Bank Of America First Time Home Buyer

The first option will be available in some neighborhoods in Charlotte, Dallas, Detroit, Los Angeles and Miami. The new mortgage, called the Community Affordable Loan Solution, aims to help qualified individuals and families get affordable loans to buy a home, the bank said.

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Applicants do not have to be black or Hispanic to qualify for the product, bank representatives said.

“Home ownership strengthens our communities and can help individuals and families build wealth over time,” AJ Barkley, head of home and community lending for Bank of America, said in a statement. “Our community lending facility will help make the dream of homeownership more attainable for many black and Hispanic families, and is part of our broader commitment to the communities we serve.”

The loan does not require mortgage insurance — an additional fee typically charged to buyers who put down less than 20% of the purchase price — and no minimum credit score. Instead, eligibility will be based on factors such as timely payment of rent and utility bills, telephone and car insurance payments. Prospective buyers must also complete a homebuyer certification course offered by Bank of America and federally approved housing counseling partners before applying for the loan program, the bank said.

The racial gap in the US homeownership rate remained significant in 2020, the most recent year for which National Association of Homeowners data is available.

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For white households, the homeownership rate is 72.1%. That compares to 51.1% for Hispanic households and 43.4% for black households. The NAR says the black home ownership rate is lower in 2020 than it was in 2010.

“During the pandemic, rising home prices and low housing supply have affected black families more than any other racial group,” NAR said in the report. The association said that white families are now 40 percent more likely to be able to afford a home. Compared to black families, the association said.

Bank of America and other major financial institutions such as Wells Fargo have a track record of lending to people of color and potential buyers with disabilities.

Bank of America’s Countrywide Financial, a subprime lender it bought in 2008, was fined $335 million in 2011 for charging black and Hispanic homebuyers higher interest rates than white applicants. .

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In 2012, Wells Fargo agreed to pay $175 million to settle allegations that it targeted people of color with riskier and more expensive home loans. And the city of Miami sued JPMorgan Chase in 2014, accusing the bank of predatory lending in communities of color. A white circle with a black border around the shape points upwards. It says ‘Click here to return to the top of the page.’

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Our experts answer readers’ home buying questions and write unbiased product reviews (this is how we evaluate mortgages). In some cases, we receive commissions from our partners; However, we have our own opinions.

If you are a first-time home buyer struggling with the credit and down payment requirements that traditionally come with a mortgage, these home loans for first-time buyers can help you overcome these obstacles and Finally getting the keys to your own home. .

Note: The definition of a first-time home buyer varies from lender to lender, but many use the U.S. Department of Housing and Urban Development definition, which includes those who have owned their primary residence within the last three years. Who does not own Additionally, many of the loan programs listed here allow non-first-time home buyers to apply.

The mortgages listed here have features that make them affordable for first-time home buyers and other cash-strapped buyers. All allow low or no down payments, and many do not require private mortgage insurance (PMI).

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Mortgages with less than 20% typically require PMI. PMI is a cost added to your monthly mortgage payment to help offset the risk it takes for the lender to allow a lower payment.

Many of these mortgages also have flexible credit requirements, such as allowing borrowers to use non-traditional credit to qualify. Keep in mind that some lenders will only let you do this if you don’t have a traditional credit score. If you have a low score, you still need to work to improve it before you qualify for a mortgage.

What types of loans are best for first-time buyers? A chevron icon indicates an expandable section or menu, or sometimes previous/next navigation options.

First-time home buyers often turn to government-backed mortgages like FHA loans because of less stringent credit requirements and lower down payments. First-time buyers may prefer conventional mortgages, as they allow for a down payment of as little as 3%.

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How can I get help with a down payment? A chevron icon indicates an expandable section or menu, or sometimes previous/next navigation options.

Your state or local government may offer some form of down payment assistance, and many nonprofit organizations have down payment assistance programs. You can search online or contact your state’s housing authority to see what’s available in your area.

How can I buy a home for the first time? A chevron icon indicates an expandable section or menu, or sometimes previous/next navigation options.

Apply for pre-approval with three or four lenders to get an idea of ​​the loan amount, terms and rates. Once you’re pre-approved, contact a real estate agent to start house hunting. You may decide to contact the agent first and get recommendations from them for good lenders in your area. The professionals who work with you will help guide you through the process.

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How much do you want to put down? A chevron icon indicates an expandable section or menu, or sometimes previous/next navigation options.

The old answer is 20%, but many people don’t pay much attention. Conventional mortgages allow a minimum down payment of 3%, while FHA lenders require a minimum of 3.5%. If you qualify for a USDA or VA mortgage, you won’t need a down payment.

What Credit Score Do First Time Buyers Need? A chevron icon indicates an expandable section or menu, or sometimes previous/next navigation options.

First-time home buyers may not be subject to different credit score guidelines just because they are new employees, but some programs may come with different requirements aimed specifically at these borrowers. A score of at least 620 is usually required if you are trying to get a loan, although you may score 580 or even as low as 500.

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A Bank of America Community Affordable Loan Solution is a very affordable option for mortgage loans that qualify, as you don’t need to bring any cash to closing.

Flexible credit requirements: no minimum credit score; Use rent, utility, phone, or auto insurance payments to create an on-time payment history.

What to look for: This mortgage is only available in “select markets,” according to the bank’s press release, including some historically black and Hispanic neighborhoods in Charlotte, Dallas, Detroit, Los Angeles and Miami. To qualify, you must meet income thresholds and complete a homebuyer certification course.

Bank of America Dream Loans require a minimum down payment of 3% and support large down payments.

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If your student loans have prevented you from qualifying in the past, you may be in luck with this loan program; U.S. Bank said it will work with borrowers who are on income-based repayment plans.

This loan comes with up to $10,000 in assistance that can be used for down payments, closing costs or other expenses related to your home purchase.

Flexible credit requirements: Accept non-traditional credit if you don’t have a good score. If you have a credit score, it must be at least 640 to qualify. A debt-to-income ratio of less than 43% is required.

Note: This mortgage is available in 25 states. It will be necessary

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