Skip to main content

Home Loans Frequently Asked Questions

Get the answers you need to common questions about your home loan

Get the answers you need to common questions about mortgages and refinancing

|

In June 2023, a global benchmark index rate used by banks to calculate interest rates for adjustable-rate mortgages (ARMs) and home equity lines of credit (HELOCs), known as LIBOR, ceased to be available in its then current form and Bank of America has transitioned to a replacement index. If you have an ARM or HELOC with Bank of America, you could be impacted.

  • The benchmark index (LIBOR) used to calculate the monthly payment amount for certain ARMs and HELOCs was retired in its then current form on June 30, 2023, and Bank of America has replaced the benchmark in certain ARMs and HELOCS with the FTSE USD IBOR Cash Fallbacks Index (formerly known as the Refinitiv USD IBOR Cash Fallbacks Index and referenced as such in prior communications). This index is SOFR plus the applicable spread adjustments as identified by the Federal Reserve Bank pursuant to the LIBOR Act.
  • If impacted, you have received a special letter communication specific to the new index. Please note that the index name changed from Refinitiv USD IBOR Cash Fallbacks to FTSE USD IBOR Cash Fallbacks due to a corporate change by Refinitiv’s parent company, LSEG. This name change had and continues to have no impact on the index’s calculation methodology, publication time or benchmark administrator.
  • Monthly payments will be based on the calculation of the FTSE USD IBOR Cash Fallbacks index in conjunction with existing loan terms you signed with your lender. Please note, if you are in the fixed portion of your ARM, your rate will not change at this time.
  • No other aspects of your loan terms, such as margin, rate caps, reset, or amortization period will change as a result of this transition.

If you have any questions, please call us at 800.669.6607, Monday through Friday, 8 a.m. to 9 p.m. Eastern.

  • The London Interbank Offered Rate (LIBOR) is an index that was used by major global banks for lending purposes.
  • An index is how variable interest rates are determined for many home lending products. Your interest rate will typically be based on an index, plus or minus a specific number of percentage points, known as the margin. While the interest rate on a loan may change due to a change in an index, the margin does not change throughout the life of a loan.
  • Certain Bank of America ARMs and HELOCs used the LIBOR index to calculate the interest rate for those loans.
  • In March 2021, the governmental entity that regulates LIBOR, United Kingdom's Financial Conduct Authority (FCA), announced that the LIBOR index would cease to exist in its then current form after June 30, 2023. As a result, Bank of America has transitioned to a replacement index.
  • For additional information visit Global Benchmark Reform.
  • Certain ARMs and HELOCs that use LIBOR as the index rate will use the FTSE USD IBOR Cash Fallbacks index as the replacement index, published by LSEG popup.
  • If your loan was impacted, Bank of America has notified you by letter and/or email informing you of the index change to the FTSE USD IBOR Cash Fallbacks Index.
  • You could also look at the contract, or Note, that you signed with your lender when you secured your loan.
  • There is no impact to fixed-rate loans (e.g., 30-year fixed, 15-year fixed, etc.) or any Fixed-Rate Loan Option (FRLO) portion of HELOCs.
  • The FTSE USD IBOR Cash Fallbacks index is the replacement index for LIBOR (as of July 2023). However, your payment will not be impacted until your next scheduled interest rate adjustment, as defined in your Note.
  • Bank of America is using FTSE USD IBOR Cash Fallbacks for Consumer products, which is published by LSEG. This index is SOFR plus the applicable spread adjustments as identified by the Federal Reserve Bank pursuant to the LIBOR Act.
  • Please note, if you are in the fixed portion of your ARM, your rate will not change at this time. Your rate will adjust at the regularly scheduled adjustment period.
  • Monthly payments will be based on the calculation of the FTSE USD IBOR Cash Fallbacks index in conjunction with your existing loan terms from your contract, or Note. Please keep in mind a range of market factors beyond the LIBOR transition may impact your payment amount. Any payment change will reflect current market conditions, and the interest rate (and therefore the payment amount) can increase or decrease whenever you have a scheduled interest rate adjustment, regardless of the index that is used.
  • No other aspects of your loan terms, such as margin, rate caps, reset, or amortization period will change as a result of this transition.
  • All interest rate changes will be handled as stated on your Note.
  • You will continue to receive monthly statements outlining your monthly payment amount.
  • As with any periodic reset of your monthly payment amount, you need to confirm your automatic payments are set up correctly. If you have automatic payments set up through PayPlan, then your payment will automatically adjust. If you have recurring payments set up through your financial institution, you may need to adjust those based on the revised amounts.
  • Keep in mind that if your loan is impacted, all other existing loan terms remain as they are. This is not a loan modification, refinance, or a change in your loan obligation. There are no additional documents for you to sign as part of this index change. The index change will happen automatically for your impacted loan.

If I have an ARM that is impacted:

  • Many ARMs reset their interest rate by “looking back” to the index in effect at an earlier date (e.g., 15, 45, 60 days). The Interest rate resets looking back to a date prior to 6/30/2023 will still be based on the LIBOR index; and those looking back to a date post 6/30/2023 will be based on the new index rate, the FTSE USD IBOR Cash Fallbacks index.
  • If you are in your adjustable-rate period, you will continue to receive rate change notifications approximately 60 or 25 days prior to the new payment amount becoming effective.
  • 60 days prior to the payment change date for lookback days 45 days or greater
  • 25 days prior to the payment change date for lookback days less than 45 days

If I have a HELOC that is impacted:

  • LIBOR will no longer be used in setting the interest rate for home equity line of credit products. LIBOR ceased or became non representative immediately after June 30, 2023. While the FTSE USD IBOR Cash Fallbacks index will be used beginning in July 2023, your payment will not be impacted until your next monthly HELOC rate calculation as defined in your contract, or Note.

Get answers to common questions about home equity lines of credit.

|

In June 2023, a global benchmark index rate used by banks to calculate interest rates for adjustable-rate mortgages (ARMs) and home equity lines of credit (HELOCs), known as LIBOR, ceased to be available in its then current form and Bank of America has transitioned to a replacement index. If you have an ARM or HELOC with Bank of America, you could be impacted.

  • The benchmark index (LIBOR) used to calculate the monthly payment amount for certain ARMs and HELOCs was retired in its then current form on June 30, 2023, and Bank of America has replaced the benchmark in certain ARMs and HELOCS with the FTSE USD IBOR Cash Fallbacks Index (formerly known as the Refinitiv USD IBOR Cash Fallbacks Index and referenced as such in prior communications). This index is SOFR plus the applicable spread adjustments as identified by the Federal Reserve Bank pursuant to the LIBOR Act.
  • If impacted, you have received a special letter communication specific to the new index. Please note that the index name changed from Refinitiv USD IBOR Cash Fallbacks to FTSE USD IBOR Cash Fallbacks due to a corporate change by Refinitiv’s parent company, LSEG. This name change had and continues to have no impact on the index’s calculation methodology, publication time or benchmark administrator.
  • Monthly payments will be based on the calculation of the FTSE USD IBOR Cash Fallbacks index in conjunction with existing loan terms you signed with your lender. Please note, if you are in the fixed portion of your ARM, your rate will not change at this time.
  • No other aspects of your loan terms, such as margin, rate caps, reset, or amortization period will change as a result of this transition.

If you have any questions, please call us at 800.669.6607, Monday through Friday, 8 a.m. to 9 p.m. Eastern.

  • The London Interbank Offered Rate (LIBOR) is an index that was used by major global banks for lending purposes.
  • An index is how variable interest rates are determined for many home lending products. Your interest rate will typically be based on an index, plus or minus a specific number of percentage points, known as the margin. While the interest rate on a loan may change due to a change in an index, the margin does not change throughout the life of a loan.
  • Certain Bank of America ARMs and HELOCs used the LIBOR index to calculate the interest rate for those loans.
  • In March 2021, the governmental entity that regulates LIBOR, United Kingdom's Financial Conduct Authority (FCA), announced that the LIBOR index would cease to exist in its then current form after June 30, 2023. As a result, Bank of America has transitioned to a replacement index.
  • For additional information visit Global Benchmark Reform.
  • Certain ARMs and HELOCs that use LIBOR as the index rate will use the FTSE USD IBOR Cash Fallbacks index as the replacement index, published byLSEG popup.
  • If your loan was impacted, Bank of America has notified you by letter and/or email informing you of the index change to the FTSE USD IBOR Cash Fallbacks Index.
  • You could also look at the contract, or Note, that you signed with your lender when you secured your loan.
  • There is no impact to fixed-rate loans (e.g., 30-year fixed, 15-year fixed, etc.) or any Fixed-Rate Loan Option (FRLO) portion of HELOCs.
  • The FTSE USD IBOR Cash Fallbacks index is the replacement index for LIBOR (as of July 2023). However, your payment will not be impacted until your next scheduled interest rate adjustment, as defined in your Note.
  • Bank of America is using FTSE USD IBOR Cash Fallbacks for Consumer products, which is published by LSEG. This index is SOFR plus the applicable spread adjustments as identified by the Federal Reserve Bank pursuant to the LIBOR Act.
  • Please note, if you are in the fixed portion of your ARM, your rate will not change at this time. Your rate will adjust at the regularly scheduled adjustment period.
  • Monthly payments will be based on the calculation of the FTSE USD IBOR Cash Fallbacks index in conjunction with your existing loan terms from your contract, or Note. Please keep in mind a range of market factors beyond the LIBOR transition may impact your payment amount. Any payment change will reflect current market conditions, and the interest rate (and therefore the payment amount) can increase or decrease whenever you have a scheduled interest rate adjustment, regardless of the index that is used.
  • No other aspects of your loan terms, such as margin, rate caps, reset, or amortization period will change as a result of this transition.
  • All interest rate changes will be handled as stated on your Note.
  • You will continue to receive monthly statements outlining your monthly payment amount.
  • As with any periodic reset of your monthly payment amount, you need to confirm your automatic payments are set up correctly. If you have automatic payments set up through PayPlan, then your payment will automatically adjust. If you have recurring payments set up through your financial institution, you may need to adjust those based on the revised amounts.
  • Keep in mind that if your loan is impacted, all other existing loan terms remain as they are. This is not a loan modification, refinance, or a change in your loan obligation. There are no additional documents for you to sign as part of this index change. The index change will happen automatically for your impacted loan.

If I have an ARM that is impacted:

  • Many ARMs reset their interest rate by “looking back” to the index in effect at an earlier date (e.g., 15, 45, 60 days). The Interest rate resets looking back to a date prior to 6/30/2023 will still be based on the LIBOR index; and those looking back to a date post 6/30/2023 will be based on the new index rate, the FTSE USD IBOR Cash Fallbacks index.
  • If you are in your adjustable-rate period, you will continue to receive rate change notifications approximately 60 or 25 days prior to the new payment amount becoming effective.
  • 60 days prior to the payment change date for lookback days 45 days or greater
  • 25 days prior to the payment change date for lookback days less than 45 days

If I have a HELOC that is impacted:

  • LIBOR will no longer be used in setting the interest rate for home equity line of credit products. LIBOR ceased or became non representative immediately after June 30, 2023. While the FTSE USD IBOR Cash Fallbacks index will be used beginning in July 2023, your payment will not be impacted until your next monthly HELOC rate calculation as defined in your contract, or Note.
Talk to
Talk to your lending specialist
your lending specialist:
from your lending specialist:

Connect with us

Lending Specialist

NMLS ID:

Meet with us

 

Mon-Fri 8 a.m.-10 p.m. ET
Sat 8 a.m.-6:30 p.m. ET
Schedule an appointment

Find another lending specialist
Enter a ZIP or city

Schedule an appointment

Mon-Fri 8 a.m.-10 p.m. ET
Sat 8 a.m.-6:30 p.m. ET

Find a location

Mon-Fri 8 a.m.-10 p.m. ET
Sat 8 a.m.-6:30 p.m. ET

Call us

Mon-Fri 8 a.m.-10 p.m. ET
Sat 8 a.m.-6:30 p.m. ET

Get a call back layer