What Are the Collateral Offered by at Bank of America?
Bank of America
Bank of America is a financial institution that operates mainly in the United States, in more than 30 states, including areas in the states of
If you want to contact Bank of America over the phone, you can try dialing out the number 1 866 467 6492 from Monday to Friday (8 a.m. and 10 p.m. ET) or on Saturdays (8 a.m. to 6:30 p.m. ET) or to any of the numbers you can find on the bank’s website. Contact with the bank can also be done through the website www.bankofamerica.com , or at a local branch, of course.
Although the bank has its headquarters in the United States, it also operates in other countries so you can have access to its products even if you are outside of America.
Secured or Unsecured
Have you ever wondered what the difference between secured and unsecured loans was? Well, here we will help you understand the difference between secured and unsecured borrowing options and we will go over the products that Bank of America offers and that do require to be secured. We will also see how you can secure them.
Unsecured loans are loans or mortgages that can be obtained by any individual who has a good credit score and a good financial situation and who of course meets all the requirements for each specific borrowing product.
Secured borrowing products are the lending products that do require that borrowers have collateral to secure the loan or mortgage.
But what is collateral? Collateral is a word related to the financial field that refers to the property or asset that a borrower can use to secure borrowing product. Banks ask borrowers for collateral because, with collateral, they make sure that the borrower has funds in case he or she falls behind with his or her payments. So, for some products, you will be asked to show collateral to secure the loan and if you stop paying for what you have borrowed, the bank can get hold of that property and take the money that you owe through a legal procedure, of course.
Bank of America Loans with Collateral
Now, let us go over some of the borrowing products from Bank of America that require that borrowers who apply for them have collateral to secure the borrowing products.
Home Equity Line of Credit
The first borrowing product that we are going to analyze is the home equity line of credit. This line of credit is designed for customers who have collateral and who are willing to use it to apply for a line of credit. With the line of credit, you will be able to use
the value of your property to get a revolving line of credit that will grant you the cash you need to make home improvements, invest, go on holidays, pay off debts or even pay for college tuition fees.
Home Equity loans are always secured and there is no way of getting a home equity product without having collateral.
> Refinance Auto Loans
In the case of auto loans, whenever you want to refinance your current auto loan, whether because you have missed some payments or because you want to save some money by refinancing, Bank of America has the Refinance Auto Loan that will suit your needs.
In the Refinance Auto Loan, the vehicle that you are actually paying works as collateral to secure your new loan. You can also choose to have other property taken into account as collateral and not the vehicle. So if you missed payments on your refinance loan, you will most probably have your car taken and the bank will take the money you owe from the sale of your car.
> Refinance Mortgage Loans and Traditional Mortgages
Mortgage Refinance Loan also take the property as collateral so if you fall behind with your payments, the bank can take the money from the house you are actually paying for. In fact, traditional mortgages work the exact same way; you secure your borrowing product with your down payment and with the property you are purchasing.
Kinds of Collateral Accepted by Bank of America
Although the collateral thing might sound easy, there are some limitations; not any property or asset can be accepted as collateral for a lending product at Bank of America, and I would say at any other bank.
Bank of America accepts as collateral for auto loans vehicles of up to 10 years which are less than $125,000. You cannot refinance vehicles that are modified or customized and you cannot refinance commercial vehicles you use for your business. Motorcycles cannot be refinanced either at Bank of America.
In the case of home equity products, you can only use your primary home, second home or vacation home to secure the revolving line of credit. If you use you secondary home, you will not run the risk of losing your primary residence if you get into a financial situation in which you cannot keep on making payments and the bank has to take legal action.
For the rest of the borrowing products, although they may not require collateral in a formal way, they generally require a down payment or a cash deposit in the case of credit cards which actually works as a security for the money you will borrow.
So remember that whenever you borrow money, you get a lot of advantages but you also run the risk of losing a lot. Banks will not lend money to any customer they consider does not have enough financial security or does not have a good credit behavior.
Category: Bank loan