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I found out about a mortgage program through Bank of America called the "no fee mortgage plus" program.
Does anyone have this?
Its a program where you need to have a credit score above 680 to qualify, and I think you need to put at least 5% down on the house.
I was just quoted everything about it and am curious to learn if anyone has it and whether there are any catches to the program.
According to Bank of America, the bank pays all your closing costs and you do not pay PMI through the program. Their interest rate right now is a little higher than some other banks I've called, but the monthly payment is the lowest since we would not be paying PMI (mortgage insurance).
How come you put down only 5% and do not need to pay PMI? A little bit strange for me... From what I know, if you put less than 20%, you do need to pay PMI. Maybe I do not know much enough...
That's the one I've got - you might be able to negotiate a better rate btw
The only thing I owed at closing was the remainder of my downpayment, which (sense I was above 5%, and negotiated after home inspection) the seller put up. You can still do this, you just can't dip below 5% of your own money with seller's concessions.
If you have other BofA accounts, you might also qualify for a different type of checking account (interest bearing - minimal, but interest nonetheless) as well as brokerage account (discounted trades).
Quote:
Originally Posted by Tulpan78
How come you put down only 5% and do not need to pay PMI? A little bit strange for me... From what I know, if you put less than 20%, you do need to pay PMI. Maybe I do not know much enough...
PMI is something the bank requires. This program bypasses that requirement if you qualify.
How come you put down only 5% and do not need to pay PMI? A little bit strange for me... From what I know, if you put less than 20%, you do need to pay PMI. Maybe I do not know much enough...
The way Bank of America explained it to me is that this is some sort of special program that they offer for people that qualify with the credit score above 680, etc. They said they've been offering the program for the past 16 months and they did it to boost their mortgage business. He said that Bank of America was rated as #1 in home mortgages last year and its partly because of this program they have. I guess they think people with excellent credit and 5% down aren't risky.
I don't really know though. This is all just a guess and my opinion.
I have the same program...they covered all fees in the end...even my legal was inculded (which I didn't think was covered so that was $750 back in my pocket)...also no PMI....its a great program if you don't have alot to put down. I actual caught the program right before they wanted 5% and was offering no money down, but I still put 10% down anyway. I think the only catch is that the interest rate is a little higher then other rates cause that's how BOA makes their money for covering all fees...but I had my seller pay down points so I still got a very good rate.
How come you put down only 5% and do not need to pay PMI? A little bit strange for me... From what I know, if you put less than 20%, you do need to pay PMI. Maybe I do not know much enough...
PMI can be covered with a slightly higher interest rate. LPMI=lender paid mortgage insurance.
Thats a typical no-fee gimmick, but not the BofA rates. If you apply for a standard mortgage, you'll see the same rates.
Yeah, BOA is typically expensive...
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