Bank of America's Personal Loan Options: Reviewed
Bank of America does not offer personal loans. Instead, it provides financing for buying a home, a car, or starting a business. You can also find lots of decent credit card options at BoA. Read on to learn how the bank may work for you.
Go somewhere else for a personal loan, but don't count out Bank of America for other financing solutions
Let's get it out of the way:
Bank of America does not offer personal loans.
It does, however, offer many types of loans that can help like a personal loan, including auto loans, business loans, mortgages, and home equity lines of credit.
Should you only be looking for a personal loan, then depending on your credit score, you can check out my article, 9 places to get a loan - even if you have bad credit or, if you're a credit star, the 8 best places to get personal loans.
What we're going to do here is review Bank of America's loan program, since several services mimic what some may want to do with a personal loan.
Bank of America personal loans compete with Upstart personal loans
Upstart is a relatively new personal loan company that was founded by former Google employees.
Loans can range from $1,000-50,000 with rates as low as 9.48% — an amount that's lower than some credit cards.
In addition to your credit score, Upstart also looks at your background and education to determine your eligibility for a personal loan — something that's not often done in today's lending circles.
We have a complete list of all personal loan providers, which you can easily compare over on our personal loan page at Credit Loan.
The Question Everyone Is Asking
"Does Bank of America provide personal loans to people with bad credit?"
Bank of America provides two types of loans to their customers: secured and unsecured loans.
Unsecured loans, despite their worrisome name, are simply loans where an amount is lent to you without any guarantee of your assets.
In other words, you don't need to put up any collateral, such as your car or your home, in order to qualify for an unsecured loan.
On the other hand, secured loans are loans wherein some form of collateral, usually a pre-payment, is made to "prove" your creditworthiness.
A secured loan is the type of personal loan most commonly given to people with bad credit or to those working to establish a good credit history.
Common types of collateral required for a secured Bank of America personal loan include your home, car, or a savings account.
Bank of America offers a wide array of competitive loans for many different needs
As one of the oldest and most well-known banks in the U.S., Bank of America is built on a firm foundation of financial strength.
This background gives these companies the flexibility to offer many different types of loan products for many different purposes including business loans, car loans, and home loans.
Each offers both secured and unsecured lines of credit, which can be helpful to boost your credit score.
Use your existing home equity as a loan to pay down your debt. A refinance loan can help you pay less on your mortgage and use the equity you've built up in your home in place of a personal loan.
Pay less interest and fewer fixed payments with a home equity credit line. Rather than refinancing, a Home Equity Line of Credit (HELOC) lets you make fixed payments on your mortgage and may even help you lower your interest rates as well.
Purchase a new or used car with an affordable auto loan. You don't need a personal loan to buy a car. Bank of America offers affordable auto loans to help you get back on the road quickly and safely.
Take advantage of 0% interest rates. Bank of America offers a variety of credit cards — some with an introductory 0% interest rate to help you in the event that you don't need much money for your personal loan.
Curious about why you may want a credit card instead of a personal loan? I recommend you read my article, 10 Compelling Reasons Why You Need Credit Cards.
There are a number of different types of loans offered by Bank of America which are flexible enough to meet many common needs where people would ordinarily seek out a personal loan.
Bank of America doesn't offer personal loans
Sure, the company offers specialized loans and financial services like credit cards, but if you're looking for a standard personal loan, then you'll have to look elsewhere.
This is a major drawback to Bank of America.
Lengthy application process. Because Bank of America does not specifically offer personal loans, you may have to wait a little longer than usual before you find out if your loan request is approved.
You may have better luck elsewhere. While Bank of America does offer some of the lowest rates on the most popular types of loan products, depending on where you live, you may have difficulty finding a Bank of America branch.
This is particularly true in the Midwest, where U.S. Bank dominates the financing landscape.
The Company's History
Did you know that Bank of America was originally known as the Bank of Italy?
Founded by Amadeo Giannini back in 1904 in San Francisco, the Bank of Italy was originally designed to serve working-class Americans who lived in nearby communities.
It was particularly targeted towards Italian-Americans.
It became Bank of America in 1930 and has since continued to grow at a breakneck pace, acquiring several banks and wealth management firms in the process.
Today, Bank of America has more consumer deposits than any other U.S. bank and is one of the top mortgage lenders in the nation.
Bank of America personal loans work best for people who need credit for major purchases — such as a home, car, or equipment to start or maintain a business
Let's face it, not everyone has a spare $250,000 or more sitting under their mattress for major life expenses.
This is where Bank of America personal loans can help.
As one of the nation's largest lenders, Bank of America is well-positioned to provide fast cash for both short-term and long-term loans.
So if you need money to start a business or you want to grow your company or make a significant purchase, Bank of America could be a good starting point.
What Bank of America Does
Bank of America offers unparalleled flexibility and variety in their loan products
With loan types ranging from mortgages and auto loans to credit cards and business funding, you may be surprised to learn that you may not need a "personal loan" after all when you could use one of these types of loans instead.
Bank of America credit cards
One of the most common types of unsecured loan, Bank of America offers a wide range of credit cards to fit nearly every need, including cards that have lower interest rates, cards that give cashback, or cards that offer travel or other premium rewards.
All of Bank of America's credit cards are chip-enabled using the latest in processing technology to further protect you and keep your financial information private.
I've reviewed Bank of America's credit cardprogram so you can learn if there's a card in there that works for you. There probably is so take a look!
Bank of America mortgages and home loans
A mortgage is a type of loan that is used to purchase property or a home. It's typically the largest loan you will ever take out and repayment plans can span as many as 30 years.
There are two main types of mortgages:
- fixed-rate, where you have a single interest rate throughout the life of the loan
- adjustable rate (ARM), where the amount changes from time to time
Most ARMs have a fixed interest rate period and then adjust once per year with market changes.
Bank of America Home Equity Lines of Credit (HELOC)
These types of personal loans from Bank of America let you turn some of the equity you've built in your home into money that you can borrow against.
A HELOC works similarly to a credit card in that there's a credit limit involved.
One of the more innovative features of a HELOC compared to other types of loans is that it can serve as a line of credit that you can use as you need it.
If you don't take money out of your HELOC, you aren't billed.
Because your house is your collateral, the interest rate on a HELOC is similar to a mortgage rather than a credit card.
Bank of America auto loans
Bank of America has three types of car loans — dealer purchases of new or used cars, refinancing existing auto loans, and loans for lease buyouts.
Car purchases from independent dealers aren't eligible for loan financing, nor are consignment sales.
In order to apply for the loan, the vehicle must be 10 years old or newer and have less than 125,000 miles.
The rates for auto loans depend on your credit history, but generally speaking:
- New car loans start at 2.99% APR
- Used car loans start at 3.29% APR
- Lease buyout loans start at 3.2% APR
- Refinancing loans start at 3.29% APR
If you're looking to get a car loan from Bank of America, it's a good idea to enroll in Bank of America's Preferred Rewards program or Banking Rewards for Wealth Management programs.
Members of these programs can be eligible for a discounted APR amount that ranges from 0.25-0.50%.
There may also be loan processing fees or early payment penalties depending on the state you live in.
You can borrow a minimum of $5,000 and up to a maximum of $100,000 for your auto loan, subject to credit approval and the value of the vehicle being purchased or refinanced.
Bank of America business credit lines
Have you been in business for at least two years and made at least $100,000 in sales last year?
If so, you may qualify for a business credit line.
Business credit lines from Bank of America range from $10,000-$100,000.
If you need liquidity in your business to pay bills or employees while waiting for customers to pay you, a business credit line can be precisely what you need.
Bank of America business term loans
A business term loan has the same qualifications as a business credit line, but you get a one-time lump sum of money that you can pay off over the next 1-5 years.
Ideally, these types of loans are best for making large purchases, such as new technology upgrades or office equipment that can help you further grow your business.
Bank of America secured business lines of credit and term loans
If you need a longer-term loan or a larger credit line than what Bank of America's unsecured loans offer and you made at least $250,000 in sales last year, you may be eligible for a secured business line of credit or term loan.
With these loans, Bank of America puts a lien on your company's assets in case you default on the loan.
If you need a lot of cash for your business and Bank of America's maximum amounts aren't enough, this type of business loan may be what you're looking for.
Bank of America equipment loans
If you need to purchase expensive equipment in order to run your business, such as
packing machines, printing presses, delivery fleets and so on, an equipment loan can provide your business with the funding it needs.
What People Love About It
People love Bank of America personal loans because they can get the funding they need for major purchases
From auto loans to business loans to larger lines of credit and home equity that you can borrow against as you need to, there's no shortage of attractive business and personal loan options at Bank of America.
That makes the bank one of the most popular choices for loan products.
Thousands of nationwide branches for convenient access. With over 4,500 branches and over 15,000 ATMs, chances are there's a Bank of America near you, making it super convenient to get the money you need.
Robust financial management tools online. Bank of America has a wide range of online tools and calculators to help you plan and stick to a budget, see how much you're spending, and even determine your net worth.
Lack of customer service is holding Bank of America back from being a truly great all-in-one bank
Bank of America has grown from its humble beginnings as a small, worker-focused bank in San Francisco to a modern behemoth of American finance.
During this time, Bank of America has made numerous acquisitions and mergers — to the point where even people who have had a decades-long history as banking customers find their customer service lacking.
Customers annoyed by phone tag, long hold times. Many customers seeking all types of loans have faced common annoyances like long wait times, being transferred from department to department, voice mail hell, and much more.
Unexplained charges and products added without permission. Some users have found their accounts inexplicably rolled over into other Bank of America products without their permission.
Others find all manner of fees tacked onto their accounts for various reasons that even the company cannot answer for.
The bottom line is that when you're a company as large as Bank of America, it's entirely possible that the right hand doesn't know what the left hand is doing, and vice versa.
Bank of America would do well to get all customer service representatives up to speed on their respective policies and regulations so that every customer can enjoy helpful, knowledgeable service when they need it.
Key Digital Services
Bank of America's all-in-one mobile app makes it easy to stay informed, get alerts, and pay bills
One of the reasons why people consistently rate Bank of America highly is because the company has spared no expense in releasing a helpful, convenient app that lets users do most of the things they can do at their local branch — right through their phone or tablet.
See balances and account details instantly. You can also access your checking or savings account, as well as your CD, IRA, credit card, mortgage, or account details using these systems or by phone, ATM, or your local Bank of America branch.
Get alerted to nearby cashback deals. Find out when local deals are available to make getting cashback for everyday purchases a breeze.
Take a photo, make a deposit. One of Bank of America's most popular mobile banking services includes snapping a photo to deposit a check. You can also get mobile alerts on your account balance.
Compatible with all major mobile payment systems. Bank of America's mobile app also features a digital wallet that's compatible with all of the leading payment systems, including Apple Pay, Android Pay, Samsung Pay, and Microsoft Wallet.
See your spending and track your budget. One of the best features of Bank of America's digital services is the ability to set up spending budgets, organize your finances for tax preparation and track your spending -- even if it isn't at Bank of America.
How To Start Using Their Services
To get a loan from Bank of America, start by filling out the pre-qualification form online
You can get started with Bank of America's services by starting the pre-qualification process online.
This will allow you to get a customized interest rate and learn how much you can save.
If you need a pre-qualification letter, such as for a mortgage or car loan, you can get that online as well.
The pre-qualification process takes less than five minutes.
If you're already a Bank of America customer, you can sign into your account and pre-fill your pre-qualification information out online.
How To Cancel
Close your account by logging in and initiating an online chat or mail a letter direct to Account Closure
You will need to pay your loan in full before you can officially "stop" using Bank of America.
If you have a checking or savings account, you may be able to close your account by logging in and initializing an online chat.
Some customers have had mixed results with this option, however.
If you'd like to send a formal letter, you should include information such as how you wish to receive your remaining funds in your checking or savings account.
Make sure to include whether you want them transferred to another bank account (include the routing and ABA numbers as well as the bank account number if you wish to do this).
Then, have each account holder sign the letter and mail it to the following address:
Account Closure, FL1-300-02-074109 Gandy Blvd.
Tampa, FL 33611-3401
What can I use the personal loan for?
You must use your Bank of America loan for its intended purpose. So, for example, you can't use a business loan for personal purposes.
The exception to this rule is with credit cards, which you can use for nearly any purpose. Just be sure that if your credit card is for business purchases, that it is kept separate from your personal accounting for tax purposes.
Does Bank of America do a credit check to see if you qualify for a loan?
Bank of America does pull your credit to determine your eligibility for many different types of loans, including how much of a credit limit you qualify for on a credit card.
Does Bank of America report to the three credit bureaus?
Loans are required to be reported to the three major credit bureaus, and Bank of America does report to Equifax, Experian, and TransUnion, respectively.
What happens in the event that I am unable to pay back my loan?
Should you be unable to repay your loan from Bank of America, you are encouraged to contact customer service by clicking here.
You may need to choose the state you reside in from the drop-down menu, as well as the product you are inquiring about.
A customer support specialist will then work with you to determine your best course of action.
What should my credit score be so I can be approved?
Your credit score is just one of the factors Bank of America looks at in order to determine approval.
You'll want to have Good or Excellent credit in order help put the odds of approval in your favor.
However, even if you don't have good credit, you may still be approved for other products that may help you get the money you need.
Is it a one-time loan? Does it expire? Or do I have access to it indefinitely?
This will depend upon the type of loan you want.
For example, a business line of credit or a home equity line of credit can be used indefinitely provided you have enough equity or business assets to mitigate the risk.
Other types of loans have time limits on them.
You will need to check the details and terms of the particular loan you want in order to determine if and when it expires.
What is the amount I can get determined by?
The amount of the loan you can be approved for will depend on the type of loan you need as well as several other factors, including your credit score and your debt-to-income ratio.
Does the loan have insurance?
Some Bank of America loans, such as home loans, may have insurance on them.
This is often known as Private Mortgage Insurance or PMI, which protects the bank in the event that you cannot fulfill your payments.
Check the details and terms of your specific loan to find out if it has insurance or if insurance is needed in order to be approved.
Do I need to have a banking account with Bank of America in order to apply for the personal loan?
You do not need a banking account with Bank of America in order to apply for a personal loan, but it certainly couldn't hurt — particularly when the bank is checking your credit and other features.
If it can see that you have a robust checking or savings account with appropriate funding to cover the cost of the loan, it may help push the odds of approval in your favor.
How easy is it to get a personal loan from Bank of America?
This will depend on the type of loan you're looking to get. A mortgage, for example, requires considerable more time and paperwork than applying for a credit card.
Have you used Bank of America for a personal loan?
How has Bank of America worked out for you?
Any great tips (or nightmares) to share with the rest of us?
Let us know in the comments below.