According to NBC News, Bank of America now offers first-time homebuyers in a select group of cities zero down payment and zero closing cost mortgages. The initiative is to help grow homeownership among Black and Hispanic/Latino communities.
Residents living in specific neighborhoods in Charlotte, Dallas, Detroit, Los Angeles, and Miami will be the first to have an opportunity to take advantage. The new mortgage, called the Community Affordable Loan Solution, aims to help eligible individuals and families obtain an affordable home loan, says the bank.
AJ Barkley, head of neighborhood and community lending for Bank of America, said in a press release, “Homeownership strengthens our communities and can help individuals and families to build wealth over time.” He added, “Our Community Affordable Loan Solution will help make the dream of sustained homeownership attainable for more Black and Hispanic families, and it is part of our broader commitment to the communities that we serve.”
BOA provided more information for prospective buyers. The institution advises loans require no mortgage insurance — the additional fee typically charged to buyers who put down less than 20% of the purchase price. In addition no minimum credit score. Instead, eligibility will be based on factors like timely rent payments and on-time bills, including utility, phone, and auto insurance payments.
They also explained prospective buyers must complete a homebuyer certification course provided by the institution and federally approved housing counseling partners before applying for the loan program. This initiative is a great way to help people of color, given Bank Of America’s history. If you recall, Countrywide Financial, a subprime lender Bank of America purchased in 2008, was fined $335 million in 2011 over claims that it charged Black and Hispanic homebuyers higher interest rates than white applicants.