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Bank of America

Lending Options Offered by America's Largest Residential Mortgage Bank

By Demir Barlas

Bank of America, founded in 1884 and headquartered in Charlotte, NC, controls more assets than any bank in the US except for Citigroup. With 6,100 locations, Bank of America also boasts one of the largest branch networks in the country; these are limited, however, to 30 states.

Bank of America's Growth

Bank of America has spent the past few years growing by acquisition; for example, by buying LaSalle Bank for $21 billion in 2007 and acquiring Countrywide Financial, the company most closely associated with the housing decline of 2007, for $4 billion. Other monster acquisitions include the $50 billion deal for FleetBoston in 2004 and the $35 billion purchase of MBNA in 2006, which brought millions of credit card customers over to Bank of America.

Bank of America Offers Five Types of Mortgages:

  • 15-year fixed-rate mortgage: High monthly payment, lower interest rate, lower total interest paid, quick equity-building.
  • 30-year fixed-rate mortgage: Average monthly payment, average interest rate, average total interest paid, average speed of equity-building.
  • 40-year fixed-rate mortgage: Low monthly payment, higher interest, higher total interest paid, slow speed of equity-building.
  • 3/1 adjustable-rate mortgage (ARM): Low monthly payment for the first three years, then it changes yearly. Frequent rate changes. Total interest paid depends on interest rates.
  • NET 5 (5/1 initial interest-only payment ARM): Interest-only for the first five years. Rates will change after the first five years, and no equity will be built during that period.

In addition, Bank of America can offer existing homeowners home equity lines of credit (HELOCs) and home equity loans, and homeowners can refinance existing home loans.

How is Bank of America Different?

While home loans are commodity services, Bank of America endeavors to put itself ahead of the pack in a number of ways:

  • Size: In the aftermath of the Countrywide deal, Bank of America is now the largest residential mortgage lender in the country.
  • Breadth of portfolio: Bank of America offers private wealth management, small-business services, international banking and a host of other personal and commercial finance services. Consumers or businesses that wish to consolidate their banking needs with a single provider can choose from among only four or five providers, and Bank of America is one of them.
  • Online banking: Bank of America has invested a great deal of money in online banking since the 1990s, and it has formed partnerships with personal finance companies such as Yodlee in order to offer customers a host of value-added features. For example, Bank of America's online banking provides instant balance updates -- since the information on bank, ATM and phone records is all synchronized -- a budgeting feature that shows you exactly where you spend your money every month, bank-to-bank transfers and personalized offers customized for your financial situation. Customers with higher balances in their accounts may be offered credit cards with higher limits.

How to Contact Bank of America

The best way to learn more about Bank of America's home loans and related services is to visit a local branch. However, the Bank of America web site offers email contact information, national toll-free numbers, FAQs and other information to woo potential customers.

Photo: © Elizabeth Weintraub

LifeWire, a part of The New York Times Company, provides original and syndicated online lifestyle content. Demir Barlas has nearly a decade of experience in business writing and editing, marketing communications and online community building. He holds a BA from Cornell University and an MFA from UCLA Film School.

At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.

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