What is Clean Sweep Debt Consolidation?

Clean Sweep Debt Consolidation was a program offered by Bank of America in 2008 and 2009. Under the program, consumers qualified for a variable-rate loan of up to $50,000. The program was marketed as a way to pay off high-interest debt. As of 2010, Bank of America no longer offers Clean Sweep loans.

How the Program Works

Consumers were charged a 3% fee for advances, which made mutliple advances costly.

Bank of America's Clean Sweep Debt Consolidation program offered consumers loans of between $500 and $50,000, at a variable annual percentage rate (APR). Consumers were charged a 3% fee for advances from the loan. No collateral was required, and consumers could get approval over the phone. The program was targeted at consumers with high-interest debt.

Benefits of the Clean Sweep Program

Interest rates on some Clean Sweep loans were as high as 21%.

The Clean Sweep program allowed some consumers to take out large loans for interest rates as low as 8%, which in turn allowed them to pay off high-interest debt. The ability to qualify for a large, low-interest loan with no collateral was an asset to those consumers who did not own their home or have other assets to use as collateral.

Drawbacks of the Clean Sweep Program

Consumers who owed money to FIA Card Services were not allowed to pay those debts with Clean Sweep funds

While some consumers qualified for the full $50,000 at 8% interest, many more did not. Interest rates on some loans were as high as 21%. Bank of America also did not allow Clean Sweep participants to use the funds to pay off consumer debt owed to FIA Card Services, which is owned by Bank of America. The variable interest rate policy also meant that a consumer's APR could vary widely, making paying off the loan difficult.