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Review of Bank of America’s Balance Assist, a New Micro Loan


Balance Assist is a short-term loan (between $100 and $500) specifically for Bank of America’s customers. The only condition of this new loan product is that you repay the amount you borrow within 90 days.

Bank of America wishes to make loans more accessible for those who need cash in the short term. Balance Assist is a unique solution for those who need small loans and can pay them back within 90 days.

Bank of America’s new micro loan is like a regular consumer loan. However, Balance Assist has removed the process of applying for the loan and makes it much easier and quicker to borrow money when you need it most.

Pros of the New Micro Dollar Loan

Do you need urgent cash? Or do you need to pay off a smaller debt that may be incurring charges?

Then, Bank of America’s New Small Dollar Loan (Balance Assist) is an excellent opportunity for you.

No Late Fees

The most attractive thing to customers about Balance Assist is that no prepayment or late fee is charged for the loan.

For a service fee of only $5, you can withdraw any amount of credit between $100-$500 with the condition to pay back the money within 90 days.

In addition, if you face any problems with your loan payment, Bank of America does not charge you any additional fees.

The system divides the borrowed loan amount into three equal installments in 90 days. Also, it does not charge you an additional transaction fee if you are late on repayments.

The absence of late payment interest also helps make repayments more realistic for cash-strapped customers. By not charging any extra fees and keeping the loan amount fixed, you are more likely to make the repayment without the debt spiraling out of control.

Many Bank of America customers are willing to take the loan because of the protection from late fee payments. This is an excellent alternative to a payday loan that will charge you exorbitant interest rates and late payments.

This gives you the comfort of paying your loan back quickly and removes the worry of not having enough funds to cover emergencies.

Full Credit Report

Another positive thing about Bank of America’s new Small Dollar Loan is that it sends loan disbursement reports and financial histories to the three major credit bureaus, which is an efficient way to increase your credit score.

Major credit bureaus such as TransUnion, Equifax, and Experian make a detailed examination of the reports according to the information sent and define the loans that have been withdrawn.

This also offers you extra protection when taking the loan. Credit bureaus know precisely when you took the loan out and how much. And since no late payment fees are charged, your credit score will not be negatively impacted.

If used wisely, Bank of America’s Small Credit Loan puts you one step closer to better low-budget loan opportunities elsewhere.

Instant Cash

You can withdraw up to $500 overall. However, this is in increments of $100 at a time. Don’t worry, you can borrow an additional amount without paying off the initial $100. However, you must wait 30 days before starting a second application.

The Balance Assist feature makes sure you have enough cash to cover unexpected expenses or emergencies while enjoying a period of respite before the loan needs to be paid back.

In simple terms, you can apply for this short-term and no-interest loan instantly. There is no lengthy application process, but there is a soft credit check, so you can get cash when you need it without jumping through too many hoops.

Bank of America has provided this feature as a small-scale emergency loan to support customers with whatever life throws at them. You can also ask for the loan to become available in your account if you have low funds and risk overdraft.

Easy Accessibility

You do not need to go to any Bank of America branch for this loan. Instead, you can specify the loan amount you want via phone or the internet and receive it instantly.

Bank of America also offers a 90-day payment period across three installments that can be automated, so you don’t even have to think about contacting them to make the repayment, it is all done for you.

If you choose this option, you will need to contact them if you will not be able to pay back the loan on time.

Cons of Balance Assist

Despite the positives, the new Small-Scale Loan implemented by Bank of America does have its drawbacks.

Although you can get a small loan easily and quickly without delay or interest payments, you must fulfill specific requirements to qualify.

Firstly, you must already be a bank customer to receive the New Small Dollar Loan.  In other words, it is not possible to get this loan without any customer registration and account.

The good news is that you don’t have to have a long history with them before the Small Dollar Loan becomes available. Balance Assist is available for both new and existing customers.

Credit Tracking

While this was also in our list of positives, some customers do not wish to track their credit history. However, it is not possible to take out a Small Dollar Loan without credit agencies knowing about it.

Bank Of America conducts a detailed credit history inquiry for this type of loan. This may cause your credit score to decline slightly and may not be deleted from your report for several years.

Although this is perceived as a negative aspect, the Small Dollar Loan does not potentially damage your credit score like payday loans or title loans.

Limited Flexibility

The new Small Dollar Loan is available only to Bank of America Customers, but not all Bank of America customers. If you live in any of the states below, you are not able to access this feature:

  • California
  • Florida
  • Georgia
  • Massachusetts
  • New Jersey
  • New York
  • Texas

Your loan approval by Bank of America is based on three key factors.

  1. Your credit profile
  2. The financial activities in your Bank of America account
  3.  Your annual earnings

No APR Scaling

The $5 borrowing fee is applied no matter how much you take out. So, whether you withdraw $100 or the complete $500, the $5 fee still applies.

This means that the APR on a $100 loan is 29.76% instead of the 5.99% APR if you withdraw $500.

However, Balance Assist still works out significantly cheaper than a payday loan, which carries a whopping 400% APR on average. Therefore, the Small Dollar loan is still the best option for emergency cash regardless of how much you need to borrow.

Uncertain Hardship Policy

Although Bank of America has stated that there are no late fees, they have not been forthcoming about how they manage accounts that do not repay their loan at all. This is troubling if you struggle to budget and have a history of loan defaults or take years to pay back the debt.

If you run a tight budget, it is best to make sure you can afford the installment payments or risk facing a nasty surprise if Bank of America comes knocking for their payments. In any case, it is not wise to dabble with such uncertainty when borrowing from any financial institution if avoidable.

The New Micro Loan from BofA

If you are a Bank of America customer who can handle debt wisely, then Balance Assist is a great way to get hold of short-term cash instantly.

The Small Dollar Loan does have a 90-day repayment limitation, and installments must be met once every month for three months. If you can commit to this, then the Small Dollar Loan is a better option than most other short-term lenders out there.

To access this loan, you must be a Bank of America customer. However, you do not need to be an existing customer. You can open a brand-new account and access this feature instantly. However, to do this as a new customer, you must have Bank of America as your primary account. For example, have your wages paid in and have some direct deposits set up.

In addition, you must not show a negative balance in your account and make regular deposits. Learn more about Bank of America’s programs by reading further.

How Bank of America Balance Assist Loan Compares

Even for a $100 loan, Bank of America’s Balance Assist does not exceed 36%, which is the highest level. This is the maximum that a bank can charge for giving out a loan.

Among other loan tariffs applied by the Bank of America, this is a good option for those with a bad credit history. And if used wisely, you can improve your credit score by paying back the loan early or on time.

Credit agencies consider payable structuring and flexible terms, along with low-rate interest options in applications. This will reflect on your credit reporting and offers some protection against negative scores – read more here about Balance Assist and its benefits.