Bank of America Launching Community Affordable Loan Solution

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Bank of America is launching a new mortgage product that would allow first-time homebuyers to purchase a home with no down payment, no mortgage insurance and zero closing costs.

In an effort to close the racial homeownership gap, the Community Affordable Loan Solution will launch in markets with predominantly Black and Hispanic neighborhoods, including Charlotte, Dallas, Detroit, Los Angeles and Miami, and may later expand to other cities. It will not require a minimum credit score and will instead consider other factors for eligibility.

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Is Bank of America’s new zero-down mortgage worth it?

Who will be eligible?

Other low down payment options to consider

Navy Federal Credit Union offers a VA home loan option that doesn’t require a down payment and is meant for current or retired members of the Armed Forces who have signed up for a Navy Federal Credit Union membership (immediate family members are also eligible).

This lender also has another option called the Military Choice mortgage, which has similar guidelines to the VA loan, such as no PMI and a 0% minimum down payment, but allows sellers to contribute up to 6% of the home’s value toward closing costs.

Navy Federal Credit Union

  • Annual Percentage Rate (APR)

    Apply online for personalized rates

  • Types of loans

    Conventional loans, VA loans, Military Choice loans, Homebuyers Choice loans, adjustable-rate mortgage

  • Terms

  • Credit needed

    Not disclosed but lender is flexible

  • Minimum down payment

    0%; 5% for conventional loan option

Pros

  • 0% downpayment for most loan options
  • flexible repayment terms ranging from 10 years to 30 years
  • Offers refinancing, second-home financing and loans for investment properties
  • No PMI required
  • Fast pre-approval
  • RealtyPlus program allows applicants to receive up to $9,000 cash back

Cons

  • Must be a Navy Federal Credit Union member to apply

Chase Bank offers down payment options as low as 3% if you apply for the DreaMaker home loan. The DreaMaker loan is designed especially for those who can only afford to make a small down payment, but it also comes with stricter income requirements. Qualifying borrowers must not have an income that exceeds 80% of the Area Median Income.

Chase Bank

  • Annual Percentage Rate (APR)

    Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included

  • Types of loans

    Conventional loans, FHA loans, VA loans, DreaMaker℠ loans and Jumbo loans

  • Terms

  • Credit needed

  • Minimum down payment

    3% if moving forward with a DreaMaker℠ loan

Pros

  • Chase DreaMaker℠ loan allows for a slightly smaller down payment at 3%
  • Discounts for existing customers
  • Online support available
  • A number of resources available for first-time homebuyers including mortgage calculators, affordability calculator, education courses and Home Advisors

Cons

  • Doesn’t offer USDA loans or HELOCs
  • Existing customers discounts apply to those who have large balances in their Chase deposit and investment accounts

PNC Bank also has a few specialized loan options to consider. It offers a special loan option geared toward medical professionals who are looking to buy a primary residence only. With this loan, medical professionals can apply for as much as $1 million and won’t have to pay private mortgage insurance regardless of their down payment amount.

PNC Bank also has a USDA loan option, which traditionally doesn’t require a down payment. Though, homebuyers interested in a USDA loan must use the loan to finance a property that’s located in a qualifying rural area.

PNC Bank

  • Annual Percentage Rate (APR)

    Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included

  • Types of loans

    Conventional loans, FHA loans, VA loans, USDA loans, jumbo loans, HELOCs, Community Loan and Medical Professional Loan

  • Terms

  • Credit needed

  • Minimum down payment

    0% if moving forward with a USDA loan

Pros

  • Offers a wide variety of loans to suit an array of customer needs
  • Available in all 50 states
  • Online and in-person service available
  • Pre-approval in as little as 30 minutes

Cons

  • Doesn’t offer home renovation loans

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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