Bank of America is supporting low- to moderate-income and multicultural homebuyers by providing down payment assistance and help with closing and other costs.
The bank will spend $5 billion over the next five years through its Neighborhood Solutions program intending to help 20,000 individuals become homeowners. The program offers financial assistance options and a network of lenders and partners, while leveraging opportunities for homebuyer education and counseling.
Eligible borrowers will be given up to $10,000 to use toward a down payment or closing costs for those seeking a Freddie Mac Home Possible Mortgage — a fixed-rate loan with lower-cost mortgage insurance and a down payment requirement as low as 3%. This down payment and closing cost program launches in the second quarter.
Borrowers can further access down payment and cost savings programs offered by state and local agencies, employers and nonprofits, according to Bank of America.
The bank’s Home Grant program will also be available to borrowers utilizing Neighborhood Solutions, and has been expanded to offer lender credit up to $7,500 to be used toward one-time closing fees or to permanently buy down the interest rate on the loan, according to the bank. The funds will not need to be repaid.
Purchasers can also make use of BofA’s Affordable Loan Solution mortgage for low- and moderate-income borrowers, which offers a competitive rate, a down payment requirement as low as 3%, and no mortgage insurance. About 90% of these mortgages go to first-time homebuyers, said the bank in a company release.
A third of all Bank of America financial centers are situated in low- to moderate-income markets.
“Today, our commitment to affordable and responsible homeownership is greater than ever, with half of our loans going to low- to moderate-income or multicultural families and communities,” D. Steve Boland, head of consumer lending at Bank of America, said in a press release.
“We know many of our clients want the power to own their first home, which can sometimes be challenging. One of the ways we’re helping is through our suite of affordable homeownership solutions and professional resources, which aid them in overcoming barriers and put sustainable homeownership within reach,” he said.