Bank of America upholds commitment to affordable housing
Bank of America will offer zero down payment/closing cost mortgage to select communities, assisting Black and Latino homebuyers.
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On Aug. 30, Bank of America announced that they were offering a zero down payment, zero closing cost mortgage solution for first-time home buyers, including certain Black and Latino neighborhoods.
Named the Community Affordable Loan Solution, it will be affecting neighborhoods in Charlotte, Dallas, Detroit, Los Angeles and Miami.
The Loan Solution’s guidelines for eligible individuals and families will not require mortgage insurance or a minimum credit score, instead focusing on factors such as timely rent, utility bill, phone, and auto insurance payments.
Eligible families and individuals will in turn be determined by their income and home location, as well as the completion of a required homebuyer certification course that will be provided by select Bank of America and HUD-approved housing partners before their application is submitted.
According to the National Association of Realtors, the gap between White and Black American homeownership is nearly 30%, with Hispanic buyers almost at a 20% gap.
Black Americans have a 43.4% homeownership rate, while a decade ago the percentage was 44.2%. In comparison, White Americans have a 72.1% homeownership rate, followed by Asian Americans at 61.7%, and Hispanic Americans at 51.1%.
While these numbers represent decade long highs for 2020, and Hispanics have finally broken 50% homeownership rates, the gap between them and White Americans persists.
This new program is a part of Bank of America’s $15 billion Community Homeownership Commitment. Their commitment is towards offering mortgages, educational opportunities, and industry leading grants to help 60,000 individuals and families purchase affordable homes by 2025.
"Homeownership strengthens our communities and can help individuals and families to build wealth over time," said AJ Barkley, head of neighborhood and community lending for Bank of America.
"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,” he continued.
Currently, Bank of America’s Community Homeownership Commitment has assisted over 36,000 people and families in becoming homeowners, with two-thirds of the loans and grants going to multicultural clients.