Bank of America: 2020 Home Equity Review

Bank of America logo

Bank of America is one of the largest banks in the world (and the second largest bank in the U.S.) The bank currently serves over 66 million customers and small business clients. With over 4,300 branches and 16,600 ATMs, Bank of America’s name and logo is well-known and visible across the country.

In November 2018, Bank of America updated their brand positioning and asked the question, “What would you like the power to do?” to reflect their desire to help customers and small business owners make their financial lives better.

They have also won awards for their mobile banking (with over 37 million users) and their mobile app has 28 million users. They also partnered with Khan Academy to launch the Better Money Habits website which features self-paced tutorials on various personal financial topics.

If you’re thinking of becoming a Bank of America customer, you can read over our 2019 bank review for more information.

Lender snapshot

Whether or not you’re a current Bank of America customer, you may want to consider checking them out if you’re thinking of tapping into your home’s equity. If you’re an existing customer, however, you may be eligible for certain discounts.

  • Home equity products include cash-out refinance and a variable-rate HELOC with fixed-rate options
  • Minimum credit score is 660
  • No application or annual fees and Bank of America pays all closing costs (up to lines of $1 million)
  • Early termination fee if account is closed within 36 months
  • Minimum loan amount on all HELOC products is $25,000

Pros and cons


  • Great discounts for existing customers: In addition to a discount for setting up automatic payments from your Bank of America checking or savings account, Preferred Rewards clients can receive an additional discount ranging from 0.125 percent to 0.375 percent depending on your tier.
  • No fees: Bank of America doesn’t charge an application fee or an annual fee and they will cover all closing costs up to a $1 million credit line.
  • Fixed-rate options: At opening, you can convert a line amount to a fixed-rate loan if you withdraw at least $15,000 and no more than 90 percent of the maximum line amount. You can also convert all or a portion of your balance to a fixed-rate option during the loan term; the minimum to be converted is $5,000.


  • Early termination fee: If you close your account within three years, you will pay a $450 fee and any closing fees Bank of America paid on your behalf.
  • Assumptions for low APR: While Bank of America has competitive rates, the low APR advertised is based on excellent credit and includes discounts for automatic payments and making an initial draw.
  • High minimum line amount: Bank of America’s minimum line amount is $25,000; this could be more than you want or need to borrow.

Mortgage Products

Bank of America offers a number of mortgage products, including fixed-rate and adjustable-rate mortgages, jumbo loans, their Affordable Loan Solution program for qualified buyers to put down as little as 3 percent on a home, and mortgage options for government loans like Federal Housing Administration (FHA) and U.S. Department of Veterans Affairs (VA).

They also offer mortgage refinance options including fixed-rate and adjustable-rate loans and FHA and VA refinance loans. If you’re interested in borrowing from your home equity, Bank of America offers a cash-out option and a home equity line of credit, or HELOC.

With a cash-out refinance, you receive one lump sum and start a new mortgage loan with a higher balance than your old one. After you pay off your existing mortgage, you can use the remainder of the money in any way you’d like. You will also start a new monthly payment schedule to pay off both interest and principal on this new loan. You can choose between a fixed-rate or adjustable-rate loan and you will pay closing costs (similar to the ones you paid when you first purchased your home).

Home equity line of credit (HELOC)

“Whether or not you have home improvement plans on the horizon, a HELOC can be a flexible and cost-effective financial tool to have at the ready when and if you need it,” said Michelle McLellan, first mortgage and home equity products executive at Bank of America.

Bank of America’s HELOC has a minimum credit line amount of $25,000. The maximum line amount is $1 million for your primary residence and $500,000 for your second home. HELOCs have a 10-year draw period followed by a 20-year repayment period. You also have the option to convert part of your variable-rate HELOC to a fixed-rate loan. The maximum loan-to-value ratio, or LTV, is 85 percent.

The HELOC currently a 12-month introductory variable APR of 3.74 percent. This rate is for a new $100,000 HELOC with a combined loan-to-value ratio, or CLTV of 70 percent. The APR is based on the current Wall Street Journal Prime Rate minus 1.51 percent, and includes a 0.25 percent autopay discount and 0.60 percent for an initial draw of $60,000 at closing.

The current variable APR after the introductory period is 5.57 percent.

At your account opening, you can convert the line to a fixed-rate loan if you draw at least $15,000 (but no more than 90 percent of your line). You can also decide to convert a portion of your HELOC balance to a fixed-rate loan during the loan term. There is no fee and you can have up to three fixed-rate loans at one time. The minimum withdrawal that can be converted is $5,000 and the loan term can range from one year up to the account maturity date.

While the APR on a fixed-rate loan may be higher, it does give you the option to pay both interest and principal in predictable and fixed payments. That certainty allows you to better budget your money as you will never have to guess the monthly payment amount or face higher payments if rates rise.

Lender fees

With a Bank of America HELOC, there are no application fees, no closing costs and no annual fee. There are also no fees if you choose to convert to a fixed-rate loan.

“With no fees to originate or maintain through Bank of America, you can opt to upgrade your kitchen, tap funds for college tuition or medical expenses, or just have funds accessible in the case of an emergency,” said McLellan.

Bank of America offers discounts for autopay, initial withdrawals and for Preferred Rewards clients. If you set up automatic payments for your HELOC with a Bank of America checking or savings account, you will receive a 0.25 percent discount. If you make a withdrawal when you open your account, you will receive a 0.10 percent discount for each $10,000 withdrawn with a maximum discount of 1.50 percent.

If you you’re a Preferred Rewards client, you will receive a discount ranging from 0.125 percent to 0.375 percent depending on your tier. Check out their website or speak to a Preferred Rewards specialist to learn more about this program and whether or not you qualify.

For all HELOC products, the floor APR rate is 1.99 percent and the maximum APR is 24 percent.

Borrowing requirements

The minimum credit score to apply for a HELOC is 660, but according to Bank of America’s 2018 annual report, 5 percent of Bank of America HELOC borrowers have a credit score below 620.

All loans are subject to approval and your APR will depend on your credit score, loan amount, work history, monthly income and monthly debts, property value and property location.

How to apply

You can apply for a Bank of America HELOC using their online application.The whole process should take about 15 minutes. After answering initial questions, you will be shown how to upload any required documents and how to check on the status of your loan application.

If you need assistance with the application, or you have questions or want to discuss fixed-rate loan options, you can schedule an appointment with a branch lending specialist or speak to one over the phone or through an online chat.

The typical closing time is anywhere from two to five weeks after loan approval.

View home equity rates

Tap into the value you have in your home to get the funds you need.

Get started

For more information about Bank of America’s HELOC, visit their website or call 800-779-3894, Monday through Friday, 8 a.m. to 10 p.m. EST or Saturday from 8 a.m to 6:30 p.m. EST. You can also schedule an appointment online to meet with a lending specialist at your local branch. In addition to information about their products and the online loan application, the Bank of America website features a wealth of information on tapping into your home’s equity.

How Bankrate Rates Bank of America

Overall Score 4.2
Availability 3.8
Affordability 4.4
Customer Experience 4.5

Editorial disclosure: All reviews are prepared by staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the lender’s website for the most current information.