Bank of America is one of the “top four” mortgage lenders in the country. This group of lenders, whose other members include NP Morgan Chase, Wells Fargo and Quicken Loans, currently serves almost 15 percent of America’s mortgage borrowers. Bank of America offers a variety of mortgage packages, including variable-rate and fixed-rate mortgage plans. Bank of America mortgages are available to customers all over the 50 states of the United States. In addition, the bank has jumbo mortgage plans, and its Affordable Loan Solution is a favorite of borrowers with low down payments. Popular mortgage plans at Bank of America include the 15-year, 20-year and 30-year fixed-rate mortgage plans. In today’s article, we list typical Bank of America mortgage rates at the moment.
What Are Bank of America’s Mortgage Rates?
What You Need to Know about Mortgage Types at Bank of America
Like the other major mortgage lenders, Bank of America offers both short-term and long-term mortgage plans. Shorter-term loans from the bank can enable you to save significant amounts of money in terms of interest, but you will have to foot a bigger monthly payment bill than you would if you were to choose longer-term schedules.
Jumbo Mortgages: Bank of America Rates
Bank of America has a variety of jumbo loans. Thes loans, defined by Freddie Mac and Fannie Mae as loans equal to or over $453,100, are for people wanting an expensive home. Jumbo loans typically have higher interest rates than other loans and can be fixed or adjustable-rate mortgages (ARMs).
Bank of America Adjustable-Rate Mortgages
An adjustable-rate mortgage (ARM) has a provision for variable interest rates that will change over time. These changes are usually made by Bank of America when there is a change in the London Interbank Offered Rate (LIBOR) index. The loan, however, has an initial payment period that has fixed rates similar to those of a fixed-rate mortgage. This mortgage type is suitable for people who have little money to spend upfront but expect to have enough money to make payments in the future. Bank of America mortgage rates are generally lower for borrowers who have a short opening period.
Bank of America offers three types of adjustable-rate mortgages:
The first number in the mortgage type is the number of years the loan will remain at fixed rates. After that, the interest will change annually based on the prevailing LIBOR market index.
The Affordable Loan Solution
The bank designed a mortgage plan specifically for people who are not in a position to make big down payments. The Affordable Loan Solution enables people to get a mortgage with down payments at as little as three percent of the value of the home. These loans can be obtained for terms of 25 and 30 years and are invariably fixed-rate loans. People who independently or jointly own property do not qualify for this plan.
VA and FHA Bank of America Mortgage Rates
Bank of America also offers VA and FHA loans. FHA loans are insured by the Federal Housing Administration and are intended for low-income families. The loans usually either require little down payments and/or are available to people with low credit scores. VA mortgages, on the other hand, are for past or current members of the military and also usually accept borrowers with low down payment amounts.
Bank of America Mortgage Rates Currently
The following rates are made for a mortgage, assuming a down payment of 20 percent for a loan of $175,000. For this loan, the average mortgage rates at Bank of America currently are as follows:
Since the jumbo loan, by definition, has to involve amounts of at least $453,100 for a single family home, the amount of money we used for this loan is $500,000. A 30-Year Fixed-Rate jumbo mortgage at Bank of America currently attracts an interest rate of about 4.291 percent. It is also worth noting that, for the FHA loan in the example above, the required down payment is just 3.5 percent.
Monthly Payments at Bank of America
The total amount of money you will pay monthly toward your mortgage is not obtained by simply calculating the interest rate. Other factors come into play to determine your monthly payments. The size of your down payment will determine how much of the loan you need to cover each month. Financial situations differ, but we have compiled a guide list for a loan of $175,000.
Bank of America Mortgage APR
The mortgage interest rate is different from the Annual Percentage Rate (APR). While the mortgage rate is flat, the APR comes with other costs that may include closing costs, points, insurance and origination fees.
Bank of America Mortgage Refinance Rates
Refinancing may improve the terms of the loan for borrowers in some situations. Bank of America refinance rates vary wildly from borrower to borrower, depending on the borrower’s credit score, mortgage points, current level of home equity, whether the home is the primary residence or not, and the amount of the loan. It is important to remember that Bank of America may include Private Mortgage Insurance (PMI) as part of the closing costs in the refinance package, but you can avoid paying PMI if you own at least 20 percent equity in the home.
Are Bank of America Mortgage Rates Competitive?
Although Bank of America mortgage rates are not known for being the best on the market, the bank’s rates are very competitive and are usually lower than the national average. A quick comparison between Bank of America mortgage rates and two of the other big four lenders, as well as a smaller lender SunTrust, shows that the bank’s rates are competitive, indeed.
For a 30-year fixed mortgage, compared to Chase’s 4.607 percent, Wells Fargo’s 4.733 percent and SunTrust’s 4.70 percent, Bank of America offers rates of 4.336 percent. For 30-year fixed jumbo mortgages, compared to Chase’s 4.625 percent, Wells Fargo’s 4.708 percent and SunTrust’s 4.775 percent, Bank of America mortgage rates average about 4.291 percent. For 15-year fixed mortgages, while Chase offers interest at rates of 4.104 percent, Wells Fargo at 4.179 percent and SunTrust at 4.10 percent, Bank of America’s rates average is just 3.788 percent. For the 5/1 ARM, compared to Chase’s 4.656 percent, Wells Fargo’s 4.45 percent and SunTrust’s 4.49 percent, Bank of America mortgage rates average 3.625 percent.
How to Get the Best Mortgage Rates
A home mortgage is the most expensive purchase many families ever make. Your choice of mortgage lender will have implications that will stretch out for years. Never settle for a mortgage from a financial institution just because it is your favorite bank or because it is the first financial institution across the street. Do extensive research and compare a number of offerings from several lenders. Finding an affordable lender will, no doubt, save you trouble in the future. There are a number of online tools that can help you compare mortgage offerings from various institutions. In additions, you can get free home-buying advice from our experts at HomeBuyingCafe. Of course, your efforts in comparing various lenders will go to waste if lenders deem your untrustworthy. You can improve your chances of getting good rates from any lender taking some basic steps.
Improve Your Credit Score
Mortgage lenders reserve their lowest interest rates for borrowers with high credit scores. You stand to save thousands of dollars over the course of your mortgage if you have a high credit score.
Build Up a Record of Employment
Lenders are more likely to offer good interest rates to borrowers who show evidence of at least two years of employment (especially with the same employer) than with people who are self-employed or freelancers.
Put Down More in Down Payments
Although many lenders accept mortgage applications from people who have modest down payments, interest rates usually go down as the amount put down as a down payment goes up. Twenty percent is usually considered the perfect minimum down payment for a mortgage.
Bank of America is rated highly by rating financial rating organizations. The bank offers low-interest rates, good APRs, a physical presence in most parts of the country, and a huge selection of loan offerings. Among the bank’s offerings are FHA and VA loans. One of the loan packages that makes Bank of America stand out is their Affordable loan solution. This package enables lenders with little money in terms of down payment to get a loan. The bank, however, has a litany of negative reviews from many former and current customers, and you need to put this into consideration when thinking about getting a loan from the bank.