Bank of America announced on Tuesday a new $5 billion affordable homeownership initiative that will include down payment or closing cost help for low- to moderate-income and multicultural home buyers. The program is aimed at helping more than 20,000 individuals and families over the next five years move toward homeownership, the bank said.
Bank of America’s Neighborhood Solutions program includes a down payment and closing cost assistance option, as well as low-down-payment mortgages and grants that can be applied to non-recurring closing costs. The program also includes forming strategic partnerships with real estate professionals and a national network of affordable housing nonprofit partners for homebuyer education and counseling to help low- to moderate-income and multicultural home buyers achieve homeownership.
Through the bank’s new down payment and closing cost program, which will launch in the second quarter of this year, the bank will give eligible borrowers up to $10,000 to be used toward their down payment or closing costs when they get a Freddie Mac Home Possible mortgage.
Also, eligible borrowers could qualify for a lender credit of up to $7,500 that could be used toward nonrecurring closing costs, such as title insurance and recording fees or to permanently buy down the interest rate. The funds don’t require repayment.
The bank also announced the Affordable Loan Solution mortgage, a fixed-rate loan for low- and moderate-income borrowers that offers a competitive rate with a down payment as low as 3 percent and no required mortgage insurance. The majority of these loans go to first-time home buyers, the bank said.
“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,” said D. Steve Boland, head of consumer lending at Bank of America. “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.”
Source: Bank of America
