Bank of America Corp.'s commitment yesterday to provide a national nonprofit with up to $6 billion of low-cost financing for home buyers should not relieve the bank of other obligations to Massachusetts-based housing programs, officials said yesterday.
On the eve of Federal Reserve hearings into a proposed $47 billion merger with FleetBoston Financial Corp., Bank of America officials were in Boston yesterday to announce an expanded loan program with the Neighborhood Assistance Corp. of America.
The Charlotte, N.C.-based bank's program with NACA will provide financing for about 40,000 homes with loans that do not require down payments, closing costs, fees or perfect credit. They carry below-market interest rates, now 4.875 percent for a 30-year fixed-rate mortgage.
The loans, which have income eligibility guidelines, are testimony to Bank of America's commitment to working people across the country, a program that will make homeownership a greater possibility for prospective buyers in 29 states and the District of Columbia, said Bruce Marks, NACA chief executive officer.
''It is America's best mortgage product,'' Mr. Marks said in announcing a program that expands an existing $3 billion Bank of America commitment.
The additional funds, part of a 10-year, $750 billion community economic development program unveiled last week, demonstrates Bank of America's commitment to New England, said FleetBoston Chairman and CEO Chad Gifford.
The two banks face a public hearing tomorrow in Boston where officials are expected to field questions about community commitments. Some lawmakers and community activists have said they are skeptical of the merger.
NACA is a former critic of both Bank of America and Fleet but Mr. Marks had kind words for both banks and said the program bodes well for would-be homeowners.
But others expressed concern that Bank of America's commitment to a single nonprofit would reduce the bank's support for other loan and grant housing programs.
Mr. Gifford rejected that assertion, saying the $750 billion, the largest such amount in the history of commercial banking, won't go untapped.
''It's a large fund,'' Mr. Gifford said. ''We're anxious to have it go to work.''
NACA has 30 offices nationally, including ones in Boston, Lawrence and Springfield, but does not have an active presence in Central Massachusetts.
Area officials are monitoring how FleetBoston will maintain its previous commitments, said Scott M. Hayman, Worcester's director of housing services.
''Fleet's been good and responsive in Central Massachusetts to date and we don't want those relationships lost in the shuffle,'' said Mr. Hayman. ''We want to be sure that the very impressive one-time commitment to Mr. Marks doesn't eclipse our needs.''
Thomas Callahan, executive director of the Massachusetts Affordable Housing Alliance, said he will be meeting with Bank of America officials today. The outcome of that meeting will be a factor in how the alliance testifies at tomorrow's hearing, he said.
The alliance wants Bank of America to expand FleetBoston's commitment to a low-to-moderate income program that has funded 1,000 loans over the past five years in Massachusetts. Mr. Callahan said he is seeking Bank of America's commitment to fund 3,000 loans through the same program over the next 10 years.
''One of the concerns about Bank of America is that they would come in with a one-size-fits-all approach,'' Mr. Callahan said. ''To their credit, so far they've recognized that there are multiple players.''
