Bank of America offers no-down-payment, no-closing-cost mortgages to Black and Hispanic first-time buyers. Bank of America has announced that it is providing zero-down, zero-closing-cost mortgages to first-time buyers in a small number of areas in an effort to increase minority homeownership, particularly in the Black and Hispanic/Latino communities.
Some areas of Charlotte, Dallas, Detroit, Los Angeles, and Miami will be the first to have access to the new choice. The bank has announced a new mortgage product, the Community Inexpensive Loan Solution, which is designed to assist low- and moderate-income individuals and families in securing an affordable loan with which to purchase a property.
An official from Bank of America stated, “Homeownership enhances our communities and can help individuals and families grow wealth over time.” This statement was made by AJ Barkley, the company’s head of neighborhood and community financing. More Black and Hispanic families will be able to realize the American dream of homeownership with the support of our Community Affordable Loan Solution, which is just one example of our firm’s larger dedication to the neighborhoods we serve.
There is no minimum credit score or down payment amount needed to qualify for the loans, and there is no need for mortgage insurance, which is generally required for borrowers with down payments of less than 20%. Eligibility will instead depend on things like how promptly rent, utilities, phone, and car insurance are paid. The bank stipulates that prospective borrowers must have completed a homebuyer certification course taught by Bank of America or one of its federally recognized housing counseling partners prior to applying for the loan program.
According to the latest recent numbers from the National Association of Realtors, the racial difference in homeownership rates in the United States remained large in 2020.
The National Association of Realtors stated in research that “disproportionally more Black households were harmed during the epidemic by rising home prices and low housing supply than any other race/ethnic group.” The group reported that white families are now 40% more likely to be able to afford a home than black families.
The mortgage lending practices of big financial organizations like Bank of America and Wells Fargo have a mixed track record when it comes to serving minorities and persons with disabilities.
Countrywide Financial, a subprime lender acquired by Bank of America in 2008, was slammed with a $335 million punishment in 2011 over allegations that it charged minorities, including Blacks and Hispanics, greater interest rates than whites.
Wells Fargo paid $175 million in 2012 to end litigation over allegations that it discriminated against minorities by offering them more expensive, high-risk mortgages. Additionally, in 2014, the city of Miami filed a lawsuit against JPMorgan Chase, claiming that the bank engaged in predatory lending practices toward people of color.