Update 4/15/09: Rates have fallen. New rate tiers: 1.50% to 1.65% APY.
Update 1/14/09: Rates have fallen. New rate tiers: 2.00% to 2.50% APY.
Update 5/04/08: Rates have fallen. New rate tiers: 3.00% to 3.50% APY.
Update 3/18/08: Rates have fallen. New rate tiers: 3.10% to 3.60% APY.
Update 2/05/08: Rates have fallen. New rate tiers: 3.50% to 4.00% APY.
Update 9/28/07: Rates have fallen. New rate tiers: 4.70% to 5.10% APY.
Update 8/1/07: The 6.10% 2-month promo has ended for new accounts.
Salem Five Bank has started an online division called Salem Five Direct which is offering a checking account called eOne with rates up to 5.30% APY. It has a tier rate structure that starts a 5.00% APY for balances up to $10K. Balances between $10K and $25K earn 5.10% APY. Balances between $25K and $100K earn 5.20% APY and balances over $100K earn 5.30% APY. Below is a summary of the key features of this account based on info from their website:
- 6.10% APY for first 60 days on balances of $100K and over
- $25 bonus for enrolling in direct deposit
- $100 initial deposit required
- No monthly fee or minimum balance requirements
- ATM refunds up to $15 per statement cycle
- Unlimited checking transactions
- Free online bill pay and debit card
- Account requires eStatements and is not available at Salem Five branches
I called their toll-free number at 800-322-2265 and was told that this eOne account just started this week. I confirmed that it is a checking account with no monthly withdrawal or check limits. Below is a list of features that I received from the banking rep:
- The first order of 25 checks are free
- Online application must be printed, signed and sent in along with a check for the initial funding.
- Account can also be funded by wire transfer (the $20 inbound wire transfer will be waived).
- POD accounts are allowed. This must be written on the application since there are no fields for this.
- Some readers have reported a hard credit pull. CSR said that only a ChexSystem verification is done, but CSRs are often not very familiar with this issue.
- There is no Electronic Funds Transfer System for making ACH transfers. However, the bill payment system can be used for this. The CSR didn't think there were any dollar or usage limits for this.
- They do not block ACH transfer requests initated from your other bank accounts
- Wire transfers fees are $20. One inbound wire transfer fee is waived per statement cycle.
- ATM rebates (up to $15) are credited automatically at each statement cycle.
- There's no closing fee. Interest earned before the end of the statement cycle will be forfeited.
- Hold times for checks are either 1 or 5 days depending where check is from. Interest is paid from the day you deposit a check.
I was also told that except for the 6.10% rate, all the others are the standard rates. I guess time will tell if it'll remain competitive. The standard rates would be competitive for a money market account, but for a checking account it's at the top. You can get higher rates on some checking accounts but these are rewards checking accounts that require debit card usage and direct deposits. The eOne account will definitely deserve a place on my list of the best checking accounts.
Salem Five is FDIC insured (FDIC Certificate # 23296). Note that the FDIC page only lists the SalemFive.com URL and not SalemFivedirect.com. One thing to note, however, is that the toll-free number listed at Salem Five Direct is the same one listed at Salem Five.
Accounts with funds over the FDIC limit are privately insured by the Deposit Insurance Fund (DIF). DIF insurance applies to all Massachusetts state-chartered savings banks. A reader noted that Massachusetts had a number of banks fail in the 80's and not one person lost a penny in a DIF bank.
[Update 6/2/07: Reader confirmed number of checks on first order is 100 instead of 50. Also, updated hold time info. Update 5/23/07: Website now states only the first order of checks are free. Added hard pull info from readers. Update 8/22/07: Changed # of free checks from 100 to 25 based on reader's inputs.]