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Reward Checking at a New Mexico Bank (Charter)

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Charter Bank

Update 11/09/10: The bank failed in early 2010 but was taken over by a newly chartered bank that kept the Charter Bank name. The reward checking account rate is now only 0.25%

Update 11/02/09: Charter Bank has made big changes to the Turbo Checking Account. Top rate has fallen to 1.25% APY. The balance cap has risen to $50K. The debit card usage requirement has fallen to only 1 purchase per month.

Charter Bank is offering a reward checking account called Turbo Checking. It pays 0.25% and refunds ATM fees if the following monthly requirements are met: 1) 1 debit card transactions (down from 13 starting 11/2/09), 2) one direct deposit or ACH auto debit, 3) receive electronic statements, and 4) access online banking. If these are not met, the rate falls to 0.25%. The minimum opening deposit is $100, but there are no minimum balance or monthly service charges regardless if the above requirements are met.

Update 11/01/09: I received the following info from a Charter Bank rep when I emailed the bank regarding what happened to the Turbo Checking account:

We are still offering Turbo. The site is in the process of changing to our new rates and requirements. I do not know what the new rates will be. If you live in Albuquerque, Rio Rancho or Santa Fe then please come in to one of our branches to open the account. If you live out of state you can send a letter along with a photo copy of your drivers license and your social security number requesting that we open an account for you.


Update 11/13/07: The bank replied to my email about the branch visit requirement with the following:

You do not need to come to a branch to apply for the checking account. If you go to www.turbochecking.com, you can sign up. Once you submit your application and we verify your identity, we will mail you the paperwork for the Turbo Checking account. You would then need to mail back the signature card and you may also mail a check for deposit. Once we receive your signature card, we will sign you up for online banking and send you a debit card and checks, if you want checks, which will take approximately 10 days to arrive.


I was told last week when I called that they don't do a hard credit pull (just ChexSystem), and you have to pay for the first box of checks (but you can choose not to have any checks).

Update 8/30/08: A reader has reported that Charter will be limiting their Turbo Checking accounts to 1 per family as of September l, 2008. The reader also reported that Charter will start requiring 13 debit card purchases per month (up from 10) starting October lst.

Branches are located in the New Mexico cities of Albuquerque and Santa Fe. The bank is FDIC insured (FDIC Certificate # 32498).

Other Reward Checking Accounts

To learn more about reward checking accounts, please refer to my High Yield Reward Checking Reviews post. For other reward checking accounts in other parts of the country, please see my reward checking account page and my best checking account post.

Rate History:
11/02/09: 1.25% APY for up to $50K; 1.01% over; 0.25% base; only 1 debit card purchase per month required.
05/01/09: 4.01% APY for up to $25K
02/02/09: 5.01% APY for up to $25K; other rates remain the same
10/01/08: Debit card usage requirement increased to 13 per month
11/07/07: 6.01% APY for up to $25K; 1.01% APY for above; 0.25% if req's are not met. 10 debit card purchases per month required.


  Tags: Charter Bank, New Mexico, checking account, reward checking account

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Comments
33 Comments.
Comment #1 by Anonymous posted on
Anonymous
I just called the toll free number in order to confirm what you were told about the branch visit requirement. The CSR I talked with insisted that you don't need to make a branch visit to open the account. A copy of your driver's license and the signed signature cards can be mailed. So until we hear yet another story, I'll consider this an "available to all" Reward Checking account.

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Comment #2 by Banking Guy (anonymous) posted on
Banking Guy
Thanks for checking on this. These policies often change or the CSRs are often not told the right info. I've sent an email asking about this. Hopefully, it'll be consistent with what the CSR told you.

1
Comment #3 by Hans (anonymous) posted on
Hans
No Sat/Sun customer service. 11 business day hold on check deposits over $5000.

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Comment #4 by John (anonymous) posted on
John
I opened this Turbo Checking Account with them. It took some time, due to the exchange of mails. But it wasn't too complicated. No branch visit required. Open to residents of all areas, as best as I can tell. The rate has remained at 6.01 APY now for some months, even after the series of Fed rate cuts. They seem to have a couple of staff who just deal with online/Turbo accounts. Once you get in touch with them, they are pretty responsive.

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Comment #5 by TacoCruncher (anonymous) posted on
TacoCruncher
They did a soft pull on Transunion for identity verification.

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Comment #6 by Anonymous posted on
Anonymous
Bonus points for jazzy animation and music at their sign-up site http://www.turbochecking.com/

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Comment #7 by Anonymous posted on
Anonymous
I just applied for this this morning and was emailed acceptance about 2 hours later. Anyone have any comments about their Turbo checking? I'm just wondering if I need to be aware of anything.

This is my first out of state high yeild reward checking account and I have been a little hesitant to give one a go.

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Comment #8 by Anonymous posted on
Anonymous
Does anyone else notice that the Annual Percentage Yield Earned on the monthly statements is not 6.01%. I have had the account for three months and each statement has a differnt yield: 5.99%, 5.89%, 5.90%. When I apply the rates associated with these different yields, the interest actually earned using the average balance amounts listed on the statements matches the interest amounts that were credited to my account.

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Comment #9 by Anonymous posted on
Anonymous
I've had this account with them for several months now... It took a while to set up everything originally by mail... No branch visit required. But once we finished that...everything has been great. As mentioned, there's basically one or two bank staff who handle these accounts. I now know them, and they know me, by name. Yes, can't reach them on weekends. And no internal ACH system. But you can push or pull from external accounts using their ACH. The account comes with a Visa debit/ATM card to access your money, and they even refund others ATM charges up to some limit. They have online banking and free bill pay. And you get an e-mail every month confirming (yes or no) that you met each of their criteria for getting the high interest rate. Their 6% rate has stood firm, so far, despite all the Fed rate cuts . --John in Los Angeles

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Comment #10 by Anonymous posted on
Anonymous
I was the poster on May 16. Today (June 14) I finally got my pin number and have access to my money. So, you can plan on about a month to complete the process. I mailed my initial deposit, so you might be able to shave a couple days off with a wire transaction.

Also I suggest if you do send your opening depost by mail that you just send a minimum amount because they place a hold on it for 2 weeks. I still have a hold on my check of 500 dollars for a couple more days, but the money I ACH from Country Wide was available the same day.

Besides the slow process, everything else has gone easy. Now to try out the Visa debit card and cross my fingers they keep the rate up. With my luck, the rate will be lowered at the end of June and the second quarter.

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Comment #11 by Dan (anonymous) posted on
Dan
This bank only got 2 stars on bankrate.com. The CAEL rating is a 4 (1 is best). I would go for another bank/cu with a better rating.

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Comment #12 by Anonymous posted on
Anonymous
Anonymous wrote "Does anyone else notice that the Annual Percentage Yield Earned on the monthly statements is not 6.01%. I have had the account for three months and each statement has a differnt yield: 5.99%, 5.89%, 5.90%."


My comment: Notice that the 6.01% was APY, meaning per year. Monthly, the rate is probably somewhere around 5.90%. Hence, you are paid monthly at that lower rate. At the end of the year, it works out to 6.01% APY. I never really understood APR vs APY, but i've been told this is accurate.

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Comment #13 by Anonymous posted on
Anonymous
Oh and the bank is FDIC insured. I cross verified by going to the FDIC website.

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Comment #14 by Michael (anonymous) posted on
Michael
I opened an account in August and it took about 3 weeks to get everything rolling. Their staff were professional and friendly to deal with over email. The process informs you of a $100 initial deposit, but I didn't send a check in the mail. I just sent in the application and forms. They setup my account with online access, which allowed me to do an ACH transfer through ING Direct instead of having to send a paper check in the mail. So I was happy with that, but you still have to fund your account with-in 10 days of opening I think.

The first month they automatically award 6.01% return and the rate so far is still the same. This month I did receive a notice that they increased the number of POS check card transactions to 13 starting in October.

I also like their Bill Pay functionality for some banks you can't schedule payments far into the future like ING Direct restricts future payments up 3 months. With Charter Bank I had no problems doing this and it allows you to put a frequency on your re-occuring payments, which you can provide to repeat until a chosen date. It even has the ability to do variable payments on a reoccuring payment, but so far I have not needed to do that. Their bill pay is simply easy to use and very functinal. All my payments have been made on time.

As a banking customer I am satisfied so far and look forward to a long lasting relationship.

I use ING Direct mainly because they have an overall ok interest rate, but mainly they don't charge you to transfer money to any other instituion up 3 that are linked. I have my paycheck direct deposited into ING Direct and it takes about 2 days for it to be transferred to Charter or any other place. I setup the automation on the transfers so I don't have to think about it. I budget every dollar so 2 extras days to get my funds transferred from ING to Charter is not a big deal to me. With this in place I can easily switch to any bank with little work if I need too.

1
Comment #15 by Anonymous posted on
Anonymous
The APR will fall from 6.01% to 5.01% effective 2/1/09 :-(

http://www.charterco.com/personal/turbo.cfm

1
Comment #16 by Anonymous posted on
Anonymous
The APR is 5.01%.

1
Comment #17 by Anonymous posted on
Anonymous
the rate is going to be lowered to 4.01% starting in Apr 2009

1
Comment #18 by Anonymous posted on
Anonymous
Yup, and I've given up on them.

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Comment #19 by Anonymous posted on
Anonymous
My rewards notification today says the rate is to drop to 4.01% beginnning 5/1/09. Funny that I had just transferred most of my balance to my other account that has a higher limit, so I wouldn't have to worry about fulfilling the requirements for both accounts every month.

1
Comment #20 by Anonymous posted on
Anonymous
looks like 4.01 will be the new norm..

1
Comment #21 by Anonymous posted on
Anonymous
Unfortunately, after a couple years good run with Charter, I also bailed out on them after they lowered their rate to 4% and previously had increased their number of debit card uses from 10 to 13...

Switched to another rewards checking that currently offers 4.44% and requires only 10 debit card uses. So far, the new one has been a good account and they've kept the rate constant for the past few months since I opened.

The new rewards account with First Arkansas also had a double higher limit of $50,000 vs. Charter's $25,000 cap...meaning I could keep all my loose funds in one rewards account, and not have to worry about meeting two rewards account card usage amounts every month.

I never had any bad experience with Charter, and actually their service was pretty good. But they lowered their rate and increased their requirements a bit too much, compared to other better accounts in the marketplace... So I jumped ship....

1
Comment #22 by Anonymous posted on
Anonymous
Above Post: FAB&T dropped rate like a rock; now what to do?? Charter shut down their website, pending rate drop as well. No Place to hide.

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Comment #23 by Anonymous posted on
Anonymous
Just got an email from them saying that as of today (11/2/09) the APR will be an appalling 1.25%.

This note is a bit rich, don't ya think?
"We've been a rewards checking leader since we began TurboChecking in October, 2007. Be assured that as the marketplace allows, we will pay you the highest rate that we can.

We believe you will find that TurboChecking still offers a good return on your deposits."

1
Comment #24 by Anonymous posted on
Anonymous
I've had the account with Charter and never had to call customer service for their bill pay services. Been happy even with the steady drop of rate, but the drop to 1.25% is hugue. Will be reviewing other rewards checking.

1
Comment #25 by Anonymous posted on
Anonymous
I hate it when banks patronize their customers like babies. Just like credit card rebate changes are always cioned as "upgrade." All these losers at Charter!!

It is fine even to reduce rate to zero, but please, say it as it is!!!

1
Comment #26 by Anonymous posted on
Anonymous
1.25%, but $50K!! Big deal. And one debit requirement, Cool!

1
Comment #27 by Anonymous posted on
Anonymous
IT's now been downsized! Do you want a checking account that requires 1 debit card transaction, one direct deposit or ACH auto debit, receive electronic statements, and access online banking each month just to receive Charterco 1.25% with check privilege? NOW, you can compare that to HSBC's Online Savings (1.35%) and Online Payment (0.85%) (online payment account ATM withdrawals' fees and surcharges reimbursed), or Schwab's HighYield Savings Account (1.05%) with ATM worldwide (refund ATM surcharges fees).

1
Comment #28 by Anonymous posted on
Anonymous
yeah, deserves to be the last.

1
Comment #29 by Anonymous posted on
Anonymous
I'm confused....I opened an account with Charter a few months ago. I was reviewing my October statement this morning once I read about the rate drop. My statement says my APY earned for October is 3.91%, fair enough. If my average daily balance for October was $10k, wouldn't the interest earned be approximately $391?

1
Comment #30 by Anonymous posted on
Anonymous
@confused

That rate is broken down over the year. So if you had your 10k sitting in the account for 1 year you would see that return.

To get closer to a monthly estimate divide .0391/12 * 10k.

That would be 32.58 on your statement. I'm not a banker, but you should expect close to that.

1
Comment #31 by Anonymous posted on
Anonymous
$391/month?? You sure are an optimist; lol.

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Comment #32 by Anonymous posted on
Anonymous
This bank stinks! Everything they do is antiquated...deposits at the drive through take 5+ minutes, their ATM's are from the 80's, etc. When we first opened our account and deposited some out of state checks, they were held for 3 weeks. That's insane. I can see a few days, but not that long. Additionally, we opened our account around the 24th of the month. There was no way we could make the required number of debit card purchases and have the direct deposit in place to earn the then 4%. Most banks will give you the first month free because of this....would Charter? NO. I say stay away from this bank.

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Comment #33 by Anonymous posted on
Anonymous
I joined this program when rates were 6.01%. Now they're down to 1.25%. My other high interest account has 1.25% interest rates for any money in my account that exceeds their maximum allowed for the higher rates. Looks to me like the smart thing to do is just transfer all my money from Charter into that other bank. That way I'll always have the maximum for their higher interest rate and still get 1.25% when I'm over that max.

As an aside, today's local paper noted that the fed is requiring Charter to increase the amount of capital on hand to secure deposits. Right now that allowance is $10.8 million, the fed insists it be brought up to $55.4 million. All this even though the bank is very sound financially. Barney Frank is jumping all over the OTS for putting these kinds of demands on small, financially stable banks. Be that as it may, the fed order still stands.

That said, it just might be wise for Charter to raise their rates rather than lower them. That way, they can encourage more people to put their money into Charter Bank while at the same time keep people like me from drawing their money out.

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