Expansion Follows Successful First Six Months in Partnership With Self-Help and Freddie Mac to Promote Responsible Lending
ank of America, in partnership with Self-Help Ventures Fund and Freddie Mac (OTCQB: FMCC), announced the doubling of its annual commitment to its Affordable Loan Solution™ mortgage program from $500 million to $1 billion, ensuring continued support for an innovative mortgage program that has provided more than 90 percent of its recipients first-time homeownership financing.
“Since our introduction in February, the Affordable Loan Solution program has been meeting the needs of LMI borrowers who desire a responsible mortgage product at an affordable entry point,” said D. Steve Boland, Consumer Lending executive, Bank of America. “We’re especially proud of how the Affordable Loan Solution program has become a popular choice for creditworthy first-time homebuyers, many of whom live in underserved communities.”
This year, Bank of America is enhancing the mortgage experience for clients who qualify for an Affordable Loan Solution mortgage, including automated underwriting and improving cycle times.
The Affordable Loan Solution mortgage program allows down payments as low as 3 percent on the purchase of a primary, single-family residence, with no reserve funds required in most situations. Customers are not required to pay mortgage insurance. Borrowers may use secondary financing, such as an affordable second loan, grants, or even cash they have on hand. The program also considers non-traditional forms of credit to demonstrate credit history. Loan amounts must be within conforming loan limits (up to $417,000), and applicants’ income cannot exceed 100 percent of the HUD area median income. Applicants must occupy the property, and first-time buyers must participate in homebuyer education through a HUD-approved housing counseling agency.
The Affordable Loan Solution mortgage program is offered through all Bank of America mortgage sales channels, including mortgage loan officers in offices across the country, 4,700 financial centers, bankofamerica.com, and mortgage experts by phone.
The Affordable Loan Solution mortgage program evolved from a partnership involving Bank of America, Self-Help and Freddie Mac. Bank of America mortgage loan officers, based in home loans offices and financial centers across the country, work directly with homebuyers to originate the loans. The bank sells the loans, including servicing rights, to Self-Help, which provides post-closing counseling for any borrowers who might be experiencing payment difficulties. Loan servicing immediately transfers after origination to Self-Help’s designated specialty servicer, who is handling all loans regardless of future performance.
Freddie Mac collaborated with Self-Help and Bank of America to define credit terms and approved Self-Help as a seller/servicer to facilitate the rollout of this offering to borrowers. Freddie Mac is purchasing all of the eligible Affordable Loan Solution mortgages originated via the Self-Help and Bank of America partnership.
The Affordable Loan Solution mortgage program includes an extensive quality control routine with Freddie Mac that promotes responsible underwriting and reduces potential risks to Bank of America and Freddie Mac.
Click here for more information about the Affordable Loan Solution mortgage program, or speak with a mortgage expert at 1.800.781.0242.
Bank of America
Bank of America is one of the world’s leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 47 million consumer and small business relationships with approximately 4,600 retail financial centers, approximately 16,000 ATMs, and award-winning online banking with approximately 34 million active accounts and more than 21 million mobile active users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in all 50 states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico and more than 35 countries. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange. www.bankofamerica.com
About Self-Help Ventures Fund
Self-Help Ventures Fund is an affiliate of a network of entities under the Self-Help banner that together are a leading national community development financial institution (CDFI). Headquartered in Durham, NC, Self-Help has provided over $7 billion in financing to 112,000 families, individuals and businesses. The non-profit helps drive economic development and strengthen communities by financing hundreds of homebuyers each year, as well as funding nonprofits, child care centers, community health facilities, public charter schools, and residential and commercial real estate projects. Self-Help’s credit unions serve over 120,000 people in North Carolina, California, Chicago and Florida with a full range of financial products and services. Learn more at www.self-help.org.
About Freddie Mac
Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation’s residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for approximately one in four home borrowers and is the largest source of financing for multifamily housing.