Bank of America Auto Loans Review

Point of Interest

BoA boasts very competitive interest rates, long repayment terms, and high loan amounts to cover more expensive auto purchases.

If you’re in the market for a new vehicle, a Bank of America car loan may be the solution you’ve been looking for. Bank of America offers highly competitive rates starting as low as 2.69% for new cars and low to no processing fees on a variety of loan types. 

Started in 1904 in San Francisco as Bank of Italy, Bank of America went through several mergers and eventually became the first bank in the U.S. to offer coast-to-coast operations. The financial institution is now headquartered in Charlotte, North Carolina, and operates more than 5,500 branches in over 20 U.S. states. 

Bank of America is one of the few auto lenders to offer private party financing, and it demonstrates support for people with disabilities by offering special financing options for wheelchair-accessible vehicles.

How Bank of America Stacks Up

Pros

  • A variety of loan types available
  • No prepayment penalties
  • BoA Preferred Rewards members get interest discounts

Cons

  • No financing available at independent dealerships outside of BoA’s network
  • Requires a down payment more often that similar lenders
  • Additional loan fees may apply in different states
LenderNew Car APRUsed Car APRRefi APRLoan AmountLoan Terms
Bank of AmericaStarting at 2.69%Starting at 2.99%Starting at 3.69%$7,500 – $100,000Up to 6 years

What’s Interesting About Bank of America

If you’re already banking with Bank of America, you could reap some additional benefits with relationship discounts on auto financing interest rates. Bank of America is happy to reward consumer loyalty by offering a 0.25% to 0.50% rate discount on auto loans for their Preferred Rewards members. 

Even if you’re new to Bank of America, you can still receive some nice perks on your auto financing in the form of no prepayment penalties or loan origination fees, a rate-lock guarantee for 30 days and simple online applications with approval decisions in minutes. Bank of America also offers a variety of loan types, including refinancing solutions, lease buyouts, private party purchases and wheelchair-accessible vehicle loans

Things to Consider

Like some alternative auto lenders, Bank of America will only finance cars at a dealership that is connected to its dealership network. While private party transactions are allowed, BoA does not offer financing for cars at small private or independent dealerships outside of its network. This lender also won’t finance any vehicles over 10 years old or with more than 125,000 miles on them. 

While Bank of America’s interest rates are very competitive, it does require down payments with its loans more often than other similar lenders. Although most loans don’t require separate origination fees or other loan processing fees, residents in Indiana or Ohio may be subject to some additional fees due to state laws. 

If you run into financial trouble during your loan repayment, Bank of America does offer delayed or deferment options to qualified borrowers and they will also discuss refinancing options, but Bank of America car loans cannot be transferred to or assumed by any third party under any circumstances.

Bank of America Auto Loans

Due to its variety of financing options, Bank of America may be a good fit for many car shoppers. Whether you’re currently in a car lease that you’d like to buy out, looking to buy a vehicle from a private third party, or looking for a new or used vehicle, Bank of America can help you finance your auto needs. 

Borrowers with a strong credit history who have Preferred Rewards status with an existing Bank of America account can get interest rates below 2.5%, which is extremely competitive for the industry. Bank of America will also finance vehicles up to $100,000, which nearly doubles the financing available through many other auto lenders. 

For borrowers in the market for a wheelchair-accessible vehicle, Bank of America offers extended financing terms up to 72 months, making the added expense of an accessible vehicle more manageable on a month-to-month basis.

Bank of America Auto Loan Refinancing

Customers looking to refinance an existing loan can also benefit from Bank of America’s services. The application process and loan repayment terms for refinancing loans are similar to other car loans, but these loans will have a slightly higher interest rate. While Bank of America will refinance a vehicle where more is owed on the original loan than the car is worth, this typically requires an upfront payment to eliminate any negative equity on the loan before it can be refinanced. 

Bank of America vs. Capital One

Like Bank of America, Capital One requires shoppers to purchase from its authorized dealer networks. Both banks offer convenient online application processes and refinancing options for borrowers. One significant advantage of a Capital One car loan is that borrowers can finance vehicles that cost as little as $4,000.

However, Bank of America offers significantly higher loan amounts and slightly lower interest rates, making Bank of America a more financially sound option for consumers looking to finance more expensive vehicles.

Bank of America vs. TD Bank

While you may be enticed by TD Bank’s offer of no down payment and 96-month repayment options, these terms aren’t available for everyone. Additionally, TD Bank doesn’t offer direct-to-consumer lending meaning customers have to apply for a loan through a dealership and hope that TD Bank is the lender to service the auto loan. 

Bank of America also offers considerably more stable and lower interest rates, as TD Bank is an indirect lender that purchases loans from various dealer partners. For these reasons, a small, upfront down payment with a loan through Bank of America could potentially save you hundreds of dollars over a higher interest, long-term loan through TD Bank.

Bank of America vs. LightStream 

The online lender LightStream has recently become popular for large lending purchases due to its easy online payment systems, simple application process and quick funding. 

However, Lightstream tends to have higher interest rates than Bank of America on car loans, especially for borrowers with less than perfect credit, and LightStream doesn’t have physical branch locations like Bank of America, meaning all your payments and account questions must be handled online. 

Next Steps

•    5 Steps to Get The Best Deal On a New Car or Truck

•    Common Tricks Up Your Car Dealer’s Sleeve

•    3 Roadblocks to Auto Loan Refinancing