Bank of America Car Loans: Review
Does Bank of America do auto loans? Of course it does! It would be very strange indeed for such a financial behemoth to not offer this option when all of its competitors have it. But, if you’re planning on buying a new car and looking for a way to finance the purchase, you’re probably also interested in the details: eligibility criteria, loan types, benefits, drawbacks, and how to apply. Luckily for you, we’re going to discuss all of this and more!
Bank of America Auto Loan Types
Please note that the bank offers loans specifically for modern passenger cars. If you’re looking to buy an older model, you’ll have to consider other options.
Auto Requirements
First, it must be a passenger car. The bank doesn’t finance heavy vehicles like 450-series trucks and vans, recreational vehicles, and motorcycles. The car must be no older than 10 years and have no more than 125,000 miles on its odometer.
Borrower Eligibility Requirements
You must be a US citizen, permanent resident, or non-permanent resident and be at least 18 years old. Loans are available across all 50 states and Washington, DC. Interestingly, you can apply even if you're not a Bank of America customer.
New/Used Auto Loans
Used car loan, as the name suggests, is designed to help you afford a secondhand vehicle. It is no different from regular auto loans in other regards, i.e., you must then repay the loan over time, usually in monthly installments with interest. Note that used car loans usually have higher rates due to depreciation and lender risk.
Whether you want a new or used car loan, you can easily apply both offline or online. The minimum loan amount is $7,500 ($8,000 in Minnesota). If no extra information is required, the process can be completed within one minute of the application.
The minimal Bank of America used car loan rates currently hover around 5.99%. For a new car straight from a dealership, the rates are slightly lower at 5.69%. If applying online, you can choose a debt period of 48, 60, or 72 months, depending on the loan type and collateral, terms, and conditions. If you have another time frame in mind, contact customer support after submitting your application.
Refinance Loans
Refinancing is basically replacing an existing loan with a new one, usually to secure better terms, such as a lower interest rate, reduced monthly payments, or a different loan term. This tool helps borrowers improve their financial situation by saving on interest or adjusting their schedule.
The minimum amount of refinance loan available at Bank of America is $7,500, and the feature can be accessed online, by phone, or in person at a physical branch. Bank of America car loan rate for refinancing your automobile-related purchase is 6.99%. Like new or used auto loans, refinancing options offer 48, 60, or 72-month terms. It’s an excellent alternative for people who have already had a loan with Bank of America or another lender, as well as those who can take advantage of member rate savings.
Lease Buyout Car Loans
A lease buyout car loan allows you to buy a vehicle you’ve leased at the end of your lease term. Instead of returning the car, you take out a loan to pay its remaining value, which is known as the “buyout price.” This is a popular option for when you’d like to keep the leased vehicle you’ve come to love, especially if it’s in good condition. Note that the usual Bank of America used auto loan rates are applied to this kind of purchase.
How to Apply for a Car Loan with Bank of America?
You can apply online, by phone, or in person at the bank’s local branch. The online application process usually doesn’t take long, and you can expect to receive an answer in a minute. Applying for an auto loan at Bank of America involves several key steps:
1. Check Eligibility and Prequalify
Make sure you meet Bank of America’s credit and income requirements. You can get prequalified online to check rates without affecting your credit score.
2. Gather Paperwork
You’ll be asked to provide your personal information to the bank, including your address, citizen status, employment details, and SSN. You may also be required to provide a purchase agreement or bill of sale, automobile registration, title, evidence of income or financial records, as well as the car’s VIN, year of manufacture, brand, model, and mileage.
3. Submit the Application
Complete the application online or at your local branch by providing your personal details and specifying the desired loan amount. Once approved, Bank of America will offer you the future loan’s rate and terms.
4. Complete the Purchase
Bring your letter of approval to a partner or independent dealer to buy the chosen car. If you’re considering purchasing a vehicle from a private seller, you’ll need to arrange a meeting with an auto loan specialist at a Bank of America financial center to finalize the transaction.
The funds are sent directly to the dealer or seller instead of the buyer. However, you still need to review and sign the loan agreement, setting up your repayment plan based on the agreed terms.
The Upsides and Downsides
Pros
- Lucrative rates. As advertised, Bank of America offers lower loan rates than the countrywide average. But keep in mind that the lowest rates are only provided to applicants with an excellent credit rating.
- Various financing alternatives. In contrast to many other lenders, Bank of America offers many options for financing a vehicle, including lease buyouts, refinancing, and private-party financing.
- Exclusive discount for current Bank of America customers. The bank offers interest rate discounts of up to 0.50% for its customers who’s also enrolled in the Preferred Rewards program.
- Loans for electric vehicles. You can finance an electric car or its electric charger in one loan via the bank’s network dealer.
Cons
- Limited purchase choices. There are many requirements for the type of vehicle, such as its age, mileage, and price.
- High loan amount. If you don’t need a large amount to finance your purchase, consider other banks. The Bank of America’s minimum loan amount is $7,500 for both new and used cars ($8,000 in Minnesota).
- Private party loan difficulties. When it comes to purchasing a car from a private party, everyone except Bank of America online banking users has to submit a request at a BofA financial center.
Conclusion
So, now you know not only the answer to “Does Bank of America do car loans?” but also whether you might want to apply. If you are eligible for it and need a passenger car that meets the loan requirements, you might find this financing opportunity very helpful. Bank of America makes car loans accessible with online applications, discounts for Preferred Rewards members, and flexible terms. Existing customers can take advantage of additional loyalty discounts, while the bank’s extensive network and digital tools make loan management easy and convenient.
