New Bank Of America Loans Target Blacks, Hispanics In Los Angeles

LOS ANGELES, CA — Bank of America is offering first-time homebuyers in Los Angeles new zero-down payment, zero-closing cost mortgage loans in an effort to expand homeownership in Black and Hispanic neighborhoods.

The new program, named the Community Affordable Loan Solution, is currently available for buyers in Charlotte, Dallas, Detroit and Miami in addition to Los Angeles. In offering more accessible and more affordable loans to minority populations historically charged higher rates for loans, the program aims to shrink the homeownership gap between white, Black and Hispanic Americans.

According to the National Association of Realtors, there is a nearly 30 percent gap in homeownership between white and Black Americans and a nearly 20 percent gap for Hispanic buyers. The current housing market mixed with the skyrocketing inflation makes it increasingly difficult for communities of color to buy homes, according to the association.

“As the gap in homeownership rates for Black and white Americans has widened, it is important to understand the unique challenges that minority home buyers face,” Jessica Lautz, NAR vice president of demographics and behavioral insights, said in a statement. “Housing affordability and low inventory has made it even more challenging for all buyers to enter into homeownership, but even more so for Black Americans.

The median home price in Los Angeles tripled by 280 percent since 2000, making the average price go from $231,141 to $878,396, according to new research from Anytime Estimate. Since 2020, the inflation rate has increased by 7.12 percent and home prices have increased 20 percent from last year. The salary needed to purchase the median home in Los Angeles is roughly $150,000, according to a report released this month by Visual Capitalist. The average salary in Los Angeles is $72,686 annually.

This loan will require no mortgage insurance or minimum credit score. Individual eligibility will be based on factors such as timely rent, utility bill, phone and auto insurance payments as well as income and home location. Interested buyers will be required to complete a homebuyer certification course provided by Bank of America and HUD-approved housing counseling partners before applying for the loan, according to the bank’s statement.

“Homeownership strengthens our communities and can help individuals and families to build wealth over time,” AJ Barkley, head of neighborhood and community lending for Bank of America, said in a statement. “Our Community Affordable Loan Solution will help make the dream of sustained homeownership attainable for more Black and Hispanic families, and it is part of our broader commitment to the communities that we serve.”

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