No Fee Mortgage from Bank of America !

This new No Fee Mortgage product from Bank of America has got me all excited. The main advantages to this mortgage are :

• No Closing Costs (approx. $5000 in my case)
• No PMI even if you put less than 20% down.
• Competitive Rates
• Will close within 25 days or BofA will pay your first mortgage payment
• If you dont close with BofA and go with another lender, you get $250

Below is more info from Bankrate.com

Bank of America has expanded its fee-free mortgage offering nationwide. Not only do B of A home loans come without fees, but they don't require mortgage insurance, either.

With the No Fee Mortgage PLUS, Bank of America doesn't charge an application fee. The bank pays all third-party closing costs, including title insurance and appraisal. It doesn't charge for mortgage insurance up to 95 percent loan to value (in other words, borrowers have to put at least 5 percent down). B of A will pay your first month's principal and interest if it misses your closing date, and will give you $250 if you apply for a No Fee Mortgage PLUS loan but decide to get your mortgage elsewhere.

What's the catch? This loan is for home purchases, not for refinances. Subprime mortgages aren't available under the program. The bank says it not only pays all third-party fees, but lets you choose providers (such as the title company). You have to get the loan directly from Bank of America (at one of its branches or mortgage offices, or by phone or online), and not through a broker.

Borrowers can get 30-year fixed or adjustables or interest-only loans.

It sounds too good to be true, but B of A exec Floyd Robinson insists that customers "don't give up anything. They get a lot." And he says the bank gets a lot, too: A typical B of A mortgage customer ends up with five other accounts with the bank (such as checking and savings accounts, credit cards, home equity loans, and so on).

What about rates? Robinson says the mortgage rates are competitive. It's up to the customer to decide whether that's true; because B of A doesn't charge an application fee, it doesn't hurt to comparison shop.

The bank has been working on this product for more than a year, and introduced it as a pilot program in the state of Washington last year. The pilot was expanded to eight more states in February, and then was rolled out nationwide April 23. Today, the bank picked up its megaphone to talk about it.

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