BofA Finance Issues $3.76 Million Callable Contingent Income Securities Linked to Three Major U.S. Equity Indices

Structure and Maturity Terms of the Callable Securities

The securities carry a stated principal amount of $1,000 per security, with a total aggregate principal amount of $3.76 million. The pricing date was July 15, 2026, and the original issue date occurred on July 20, 2026, three business days after pricing. The maturity date is fixed at July 20, 2028, establishing a two-year term for these instruments. The disclosure indicates that the securities are issued as part of BofA Finance's Medium-Term Notes, Series A program and are structured with multiple layers of contingency.

The underlying reference assets consist of three major U.S. equity indices: the S&P 500 Index (Bloomberg symbol SPX), the Russell 2000 Index (Bloomberg symbol RTY), and the NASDAQ-100 Index (Bloomberg symbol NDX). The use of three indices creates a "worst of" structure, meaning that coupon payments and final maturity payments depend on the performance of whichever index performs most poorly. This design exposes investors to negative performance across any single index, regardless of how the other two indices perform during the investment period.

Contingent Quarterly Coupon Payment Mechanics

The securities offer a contingent quarterly coupon of $26.00 per security, equivalent to a quarterly rate of 2.60% or an annualized rate of 10.40%. However, this coupon is paid only under specific conditions tied to all three underlying indices. For each quarterly observation period, the coupon is payable only if, on each index business day during that period, the index closing value of each underlying index remains at or above its respective coupon barrier level. The coupon barrier level is set at 60% of each index's respective initial value.

The disclosure emphasizes the risk that if the index closing value of any single underlying index falls below the coupon barrier level for that index on any index business day during an observation period, the entire contingent quarterly coupon for that period will not be paid. This means that a brief dip below the barrier by any one of the three indices eliminates the coupon for the entire quarter, even if the other two indices remain well above their barrier levels. The filing states that it is possible one or more underlying indices will close below the respective coupon barrier levels on any index business day during most or all of the observation periods throughout the entire two-year term, resulting in few or no contingent quarterly coupons being paid.

Maturity Payment Structure and Principal-at-Risk Features

At maturity on July 20, 2028, the payment received by investors depends critically on whether the final index values of all three underlying indices remain above the downside threshold level, defined as 60% of their respective initial values. If the final index value of each underlying index is greater than or equal to its respective downside threshold level, investors will receive the stated principal amount of $1,000 plus any contingent quarterly coupon otherwise due with respect to the final observation period.

However, if the final index value of any underlying index falls below its respective downside threshold level, the payment at maturity becomes the stated principal amount multiplied by the index performance factor of the worst-performing underlying index. Under these circumstances, the filing discloses that the payment at maturity will be less than 60% of the stated principal amount and could be zero. This structure means that investors are exposed to the decline in the worst-performing underlying index on a 1-to-1 basis and could lose their entire initial investment if any single index declines by more than 40% over the two-year period. The securities do not provide any participation in appreciation of any underlying index.

Issuer Redemption Rights and Call Feature

Beginning on October 20, 2026, BofA Finance holds the right to redeem all of the securities at its discretion on any quarterly redemption date. The redemption payment equals the stated principal amount plus any contingent quarterly coupon otherwise due with respect to the relevant observation period. The issuer is required to provide notice to the trustee at least five business days but not more than 60 calendar days before the applicable redemption date. Once the securities have been redeemed, no further payments will be made on them.

The disclosure notes that early redemption of the securities will not automatically occur based on the performance of the underlying indices. This means the redemption decision rests entirely with BofA Finance, creating a timing uncertainty for investors. The call feature essentially gives the issuer the option to terminate the investment before maturity, which could be exercised during periods when market conditions favor the issuer or when the contingent coupons represent an unfavorable liability compared to market rates.

Pricing and Commission Structure

The securities were priced at $1,000.00 per security on the pricing date of July 15, 2026. The filing discloses an estimated value on the pricing date of $985.10 per $1,000 in principal amount, which is less than the offering price to public. This $14.90 per security difference reflects the structuring costs and commissions built into the offering. The disclosure states that the actual value of the securities at any time will reflect many factors and cannot be predicted with accuracy.

The pricing supplement breaks down the proceeds from the $3.76 million offering: the agent received $37,600.00 in commissions and fees ($7.50 per security), while BofA Finance received $3,722,400.00 in net proceeds. Morgan Stanley Wealth Management and its financial advisors collectively receive a fixed sales commission of $7.50 for each security sold, and Morgan Stanley Wealth Management also receives a structuring fee of $2.50 per security payable by the agent or its affiliates. This commission structure illustrates the embedded costs of the structured product investment.

Guarantee and Credit Risk Considerations

All payments on the securities are fully and unconditionally guaranteed by Bank of America Corporation. This guarantee applies to coupon payments, redemption payments, and maturity payments. However, the disclosure emphasizes that all payments remain subject to the credit risk of BofA Finance as the issuer and Bank of America Corporation as the guarantor. If either entity defaults on its obligations, investors could lose some or all of their investment.

The securities are senior debt obligations of BofA Finance and are not secured by any underlying reference asset. Investors do not have a security interest in or access to any underlying asset. Additionally, the disclosure clarifies that the securities are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency or instrumentality, nor are they obligations of or guaranteed by a bank. This language underscores the distinction between these structured securities and traditional bank deposit products, which might give an investor false sense of safety.

Risk Factors and Investment Suitability Warnings

The disclosure contains explicit warnings about the principal-at-risk nature of these securities. Investors in the securities must be willing to accept the risk of losing their entire initial investment based on the performance of any underlying index and also the risk of not receiving any quarterly coupons during the entire two-year term. Because payments are based on the worst-performing of the three underlying indices, a decline beyond the coupon barrier level on any index business day during an observation period, or beyond the downside threshold level on the final observation date of any underlying index, will result in the forfeiture of contingent quarterly coupons and/or a significant loss of investment, even if other underlying indices have appreciated or have not declined as much.

The filing states that the securities are designed for investors willing to risk their principal in exchange for the opportunity to earn contingent quarterly coupon payments at a potentially above-market rate. However, this opportunity comes with the risk of receiving no contingent quarterly coupon payments if any underlying index closes below the coupon barrier level during a related observation period, and the risk of early redemption at the issuer's discretion. The structured nature of these securities makes them fundamentally different from traditional bonds or equities, and the disclosure indicates that potential purchasers should carefully review risk factors contained in the pricing supplement, product supplement, prospectus supplement, and prospectus.

Registration and Regulatory Approvals

The securities were filed pursuant to Rule 424(b)(2) of the Securities Act of 1933 and are registered under Registration Statement Nos. 333-290665 and 333-290665-01. The pricing supplement is dated July 15, 2026, and is used in conjunction with a Prospectus dated December 8, 2025, a Series A Prospectus Supplement dated December 8, 2025, and a Product Supplement EQUITY-1 dated December 8, 2025. This filing structure indicates that the securities follow an established registration and prospectus framework that was previously approved by the Securities and Exchange Commission.

The disclosure explicitly states that the SEC, any state securities commission, or any other regulatory body has not approved or disapproved these securities or determined if the pricing supplement and accompanying documents are truthful or complete. Any representation to the contrary would constitute a criminal offense. This language, while standard in securities offerings, emphasizes that regulatory approval should not be interpreted as an endorsement of the securities' suitability or safety.

Issuer and Guarantor Identity

BofA Finance LLC serves as the issuer of these securities. BofA Finance is a subsidiary structure commonly used by Bank of America Corporation to issue medium-term notes and other debt securities. The guarantor is Bank of America Corporation itself, one of the largest financial institutions in the United States. The involvement of both entities creates a two-layer credit structure, though both ultimately derive from the same corporate family.

BofA Securities, Inc., an affiliate of BofA Finance, serves as the agent for the offering and is responsible for distributing the securities. The affiliate relationship between the issuer, guarantor, and agent creates potential conflicts of interest in the transaction, though such affiliate relationships are common in securities offerings and are typically disclosed and managed according to regulatory standards.