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5.50% Money Market Account Promotion at UmbrellaBank

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Update 4/25/07: The promo page now states that the 5.50% APY is only guaranteed through 7/31/07. The date was originally 12/31/07. The post has been updated with this change.

UmbrellaBank.com just launched a new promotion on its Pot O'Gold Money Market Account. When new customers open the account through this promotional page, you'll receive a 5.50% APY on all balances over $1,000. The rate is guaranteed through 7/31/07. Currently, there's no mention of this promotion at UmbrellaBank's home page. A reader left a comment about this promotion, and I called UmbrellaBank to confirmed it. It has just started so that's probably why it's not yet mentioned on the home page.

Some of the important details of the Pot O'Gold Money Market from the Pot O'Gold Summary page and from the promo page:
  • 5.50% APY for new customers on balances over $1,000 guaranteed until 7/31/07
  • 0.60% APY on balances below $1K and a $10/month fee when the daily balance falls below $1K
  • Offers check writing (up to 3/month) and the first book of checks are free
  • ATM card is available BUT they charge $1 per ATM transaction
  • $10 fee if you go past 6 withdrawals to another account per statement cycle

Some details I received from the customer service rep include:
  • No hard credit pull is done. They only do a ChexSystem verification and a soft pull
  • You can fund the account by check or by a free wire transfer
  • After the account is opened, you can link to your other bank accounts and make ACH electronic fund transfers (ETF).
  • Before ETFs are allowed, you must fill out a form and mail it in with a voided check. The External Transfer Enrollment Application is available here.
  • Each new ETF link requires an additional form and voided check.
  • ETF transfers take 3 to 5 days (customer experience is usually a better indicator of the real delay)
  • There are no fees for initiating ETF transfers
  • There are no limitations on the size of the ETF transfers
  • Only 3 ETF transfers allowed per month (This seems to contradict the website so I asked if this limit would apply if you didn't have any check or other non-ATM withdrawals, and the CSR said the 3-per-month limit would still apply).

Note, it's common for the information provided by a CSR to not always be 100% accurate, so be sure to check on your own.

UmbrellaBank.com is the online banking division of New South Federal Savings Bank. You can find UmbrellaBank mentioned by the CEO in the 2005 annual profile (pdf). New South Federal is FDIC insured (FDIC certificate # 32276). It doesn't have a history of high ratings at Bankrate.com. Currently, it only has 2 out of 5 stars (below peer group). Last September it only had 1 out of 5 stars. However, on UmbrellaBank's home page, they're advertising their rating with BauerFinancial was 3.5 out of 5 stars (good) through all of 2006.

I had thought we would see some promotions from banks at the end of HSBC's promotion. GMAC Bank just did a major rate increase to 5.30% APY on its money market account on Friday (see post). Although GMAC Bank's money market rate isn't a promotional rate, there's no guarantee to when it may end. The last time GMAC's rate was 5.30% it lasted less than a month. One nice thing about a guarantee end date is that you won't be negatively surprised like we were with E-LOAN. E-LOAN launched it's savings account last September with a 5.50% APY. It dropped to 5.38% APY in just over 2 months and then dropped to 5.25% APY in about 6 weeks after that (see post). However, the bad thing about the promo is that you'll more likely find the standard rates after the promo to be disappointing. In the last several months, UmbrellaBank's money market account rates have lagged other money market account rates. Last September they went to a tier rate structure. Currently, for balances over $1K the yields range from 4.95% APY to 5.10% APY for balances over $50K.

Thanks to reader goldbrick who mentioned this promotion in the finding deals post.
  Tags: savings account

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Comments
22 comments.
Comment #1 by Anonymous posted on
Anonymous
so does that mean if i leave $10k in there, $10k will earn 5.5% or only $9k earn 5.5% and $1k earn 0.6%

1
Comment #2 by Steve (anonymous) posted on
Steve
As long as the balance is > $1000, the entire balance will earn 5.5%

1
Comment #3 by Anonymous posted on
Anonymous
Is there an upper limit on how much you can deposit ($100K single, $200K joint)?

1
Comment #4 by Banking Guy (anonymous) posted on
Banking Guy
I forgot to ask the CSR about a maximum deposit limit. You might want to keep below the FDIC insurance limits for safety reasons.

1
Comment #5 by Anonymous posted on
Anonymous
thanks for the find! since i'm planning on buying a house around the end of this year, i think i'm just going to stash my down payment here if i can't find a good 6 month CD when the HSBC promo ends.

1
Comment #6 by Anonymous posted on
Anonymous
Can one ACH money in & out from another bank (like GMAC)? Looks like a GREAT deal !!!

1
Comment #7 by Brave Dave (anonymous) posted on
Brave Dave
How is one supposed to provide a voided check for an eSavings account (like HSBC Direct) that HAS no checks???

1
Comment #8 by Brave Dave (anonymous) posted on
Brave Dave
Well it didn't last long... looks like Umbrella has lowered the rate: It's now only 4.95% APY. The max APY appears to be 5.10% for bals >$50k.

1
Comment #9 by scott (anonymous) posted on
scott
You are looking at the wrong page,
This is a promotional rate and still shows 5.50%

http://www.umbrellabank.com/promotions/0701/

1
Comment #10 by Anonymous posted on
Anonymous
Could someone verify if they do a hard pull on your credit. When I called amd asked the CSR, she told me that they do a hard pull on Experian.

1
Comment #11 by Anonymous posted on
Anonymous
Be aware when closing the account: "Interest is not considered earned until posted. Closing an account prior to posting will result in the loss of accrued interest."

1
Comment #12 by Anonymous posted on
Anonymous
You are correct to warn re the potential for interest loss upon closing. In this situation, if you need your money, you would withdraw all but $1000 at any time of your choosing. This leaves the account open and leaves you penalty-free. Then, right after interest is credited the next time, you would close down the account completely. This way you can eat your cake, except for $1000, and have it too.

1
Comment #13 by Jeffrey (anonymous) posted on
Jeffrey
Umm, are you sure it's till the end of this year? I went to this site:

http://www.umbrellabank.com/promotions/0701/

and it seems that

"Availability of this promotional offer is subject to change without notice. The interest rate and APY may change after 7/31/2007."

Meaning the promo's only until this July?

Can someone clarify this?

1
Comment #14 by Jeffrey (anonymous) posted on
Jeffrey
and oh when you click apply now on that page you get this:

"Pot o' Gold Money Market Promotion
Guaranteed rate through July 2007
Initial Minimum deposit: $1,000.00 "

So I guess it changed to July from January.

1
Comment #15 by Anonymous posted on
Anonymous
It did change to July 2007! I applied yesterday when it still said it was until January 2008. Does this mean I just got ****ed over? I think I even suffered a hard pull from this. Is there anything I can do? With all these revelations (i.e. hard pull and this "rest of 2007" bull), I wouldn't have wasted my time. Seriously, is there anything I can or should do? Thanks everyone and good luck.

1
Comment #16 by Anonymous posted on
Anonymous
I too applied yesterday when it was through 12/312007. Today I saw it was only through 7/31/2007. I called and talked to a CSR to ensure they would honor my application from yesterday and she stated that since they only honor the promo that is in place once the funds are received, so no they would not honor my application. Since you cannot send funds via ACH at the time of the application, this is clearly bait and switch, and there is no doubt that I will NEVER do business with this institution in the future.

1
Comment #17 by Anonymous posted on
Anonymous
Talk about bait and switch. What a shyster of a bank. I called the bank yesterday 4/24/07 to confirm offer of 5.50% to 12/31/07 and was told that it was correct. I opened acount on line and mailed check. They won't get one more red cent from me and 7/31/07 can't come fast enough to say good riddance. These bast_ _ ds belong in jail not in the banking field. DJW

1
Comment #18 by Banking Guy (anonymous) posted on
Banking Guy
I've updated the post with this date change and posted on this here.

In my opinion, it's definitely bad customer service to not honor the 12/31/07 guarantee for those who had applied before the change regardless of the funding.

1
Comment #19 by Anonymous posted on
Anonymous
I spoke to a CSR today and he said they would honor applications showing "through 2007" on the signature card. So if you were lucky enough to have applied before the change to July on the website, you should be okay. I think they were overwhelmed by the response and have since changed it through July. I guess someone received a different response from a CSR, but cross your fingers that mine is right. :)

1
Comment #20 by Anonymous posted on
Anonymous
I have done business with this bank for a long time and they are good eggs. Folks here must learn, and must bear in mind, not all people are as net-savvy as those visiting here. This includes a great many bank potentates, at Umbrella and elsewhere. There actually are people out there today, including some in high management positions, who are, straight up, net ninnies. They are clueless and hope to make it somehow through life regardless. So when a website like this one sends hundreds of unexpected customers their way, they just are overwhelmed and taken completely by surprise. Then they end up looking like the troglodytes they are as they react foolishly to something outside their understanding. But these managers are not out to cheat, they are just mentally out to lunch. Net ninnies shouldn't run banks . . . but some do.

1
Comment #21 by Anonymous posted on
Anonymous
The CSR said that they will honor the rate thru the date on the signature form. In fact, I called the customer service soon after I saw the promotion and the rep told me that it will not last very long - the very next dayt they changed the guaranteed thru date.

They didn't even put the promotion on their web-site and here they are, overwhelmed by the reposnse - the power of gossip on the net.

1
Comment #22 by Banking Guy (anonymous) posted on
Banking Guy
As of 5/5/07, the 5.50% promotional page is no longer available from the link above.

Perhaps they ended this promo? If anyone can confirm this with UmbrellaBank, it would be appreciated. I'll try to call on Monday.

1