Bank of America to Exit Retail Mortgage Lending in Six States

Mortgage and Lending with Guaranteed Rate NMLS# 2611 NMLS #151088

Yesterday, Bank of America, the 3rd largest retail mortgage lender in the country, announced its decision to exit retail mortgage lending in six states.  Citing low mortgage volume, Bank of America will exit retail mortgage lending in the six states of Alabama, Alaska, Montana, Nebraska, Wisconsin, and Wyoming.

National Mortgage News confirmed the announcement with a Bank of America representative.  The bank said that it will continue to serve customers in those six states with its online and telesales divisions.   

Bank of America's retail exit comes only days after the company announced that it will soon close its correspondent mortgage lending division.  The company ranks as the 2nd largest correspondent lender in the country according to NMN and the Quarterly Data Report.  The company had recently announced its intent to close the division if a buyer could not be found.  After talks failed, the correspondent division was slated for closure. 

The correspondent division's closure will have a huge impact on FHA 203(k) Renovation mortgage for many smaller to mid-size mortgage companies.  Unless the mortgage company has its own in-house draw department, most mortgage companies seller their 203(k) loans to Bank of America's correspondent division.  With Bank of America being the primary player in the FHA 203(k) correspondent arena, it will leave a huge void to be filled.  At Prospect Mortgage, we have our own in-house draw department to handle all FHA 203(k) and HomePath Renovation draw disbursements.  This means that it will be business as usual for all of our Renovation mortgage loans.

Only time will tell about the future of mortgage lending for Bank of America.


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Michael L. Brownstead
Keller Williams Realty - Allen, TX
ABR, GRI, MRP, SRS, 1SG US Army (Ret.)

Rodney, thanks for sharing the info, no big loss though, may the smaller, local lenders prevail!

Oct 07, 2011 06:24 AM #1
Donne Knudsen
Los Angeles & Ventura Counties in CA - Simi Valley, CA
CalState Realty Services

Rodney - It sure is looking like BofA is ramping up an exit strategy doesn't it?  This has also had an effect on both CalSTRS and CalHFA programs here in CA.

Oct 07, 2011 06:44 AM #2
Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional


I think that BofA decided a long time ago that it did NOT want to be in the mortgage business. I wish they closed here in GA.

Featured in the Group "Whacked!!!"

Oct 07, 2011 09:30 AM #3
Rodney Mason
Guaranteed Rate NMLS# 2611 - Atlanta, GA
VP of Mortgage Lending - AL, FL, GA, SC, & TN

Michael......Smaller lenders all sell their loans to larger lenders like a Bank of America. This will limit their options. 

Donne....It does appear that way.  Their correspondent exit has had an impact on bond programs across the country. 

Richard.....Its looking more and more that way.  Thanks for the feature.

Oct 08, 2011 04:14 AM #4
Jackie -
770.498.7333 - Atlanta, GA
Learn to leverage technology to get more done.

Hi Rodney - thanks; your blogs help me stay up to date.

Oct 10, 2011 07:52 AM #5
Not a real person
San Diego, CA

I’m so far behind in returning comments but I don’t want to give up.
So I’m visiting as many blog posts as I can today
to spread some Tuesday cheer.
That means I probably didn’t read this post,
which is not going to prevent me from leaving some Tuesday cheer.
Feel free to delete this comment if it doesn’t make you cheerful.


Happy Tuesday!

Oct 11, 2011 01:33 AM #6
Tim Bradley
Contour Investment Properties - Jackson Hole, WY
Commercial Real Estate Expert in Jackson Hole, WY

Hi Rodney,

BofA's departure from Wyoming is a huge deal for us. We have few large banks, and mostly community banks. The community banks rely upon large banks like BofA to purchase their loans. Hopefully someone else will take up the slack...

Oct 16, 2011 03:00 AM #7
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

I think this actually good news.  I wish one of the states was PA. . . they are very difficult to work with and I would not miss them.

Oct 19, 2011 10:04 AM #8
Rodney Mason
Guaranteed Rate NMLS# 2611 - Atlanta, GA
VP of Mortgage Lending - AL, FL, GA, SC, & TN

Jackie.....I'm glad to hear.

Russel.....Thanks for stopping by.

Tim....BOA's exit will have a large impact on many lenders.  Especially those doing FHA 203(k)'s.

Joy.....Many do not like dealing with them.

Oct 24, 2011 02:12 PM #9
Marco Giancola
Beachfront Realty - Miami Beach, FL
Realtor (305)608-1922, Miami Beach Florida

Hey Rodney-that is news to me surprised Florida isn't on the list with all the bad loans they wrote here-oh wait no I'm not!

Nov 13, 2011 07:32 AM #10
Rodney Mason
Guaranteed Rate NMLS# 2611 - Atlanta, GA
VP of Mortgage Lending - AL, FL, GA, SC, & TN

Marco....It looks like they have exiting the states where they either had no retail banking presence or not much of one.  Their image has definitely suffered.

Dec 03, 2011 04:38 AM #11
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VP of Mortgage Lending - AL, FL, GA, SC, & TN
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