Dedicated to Deposits: Deals, Data, and Discussion

5.50% 4-Month Internet CD Special at Indymac Bank


Indymac Bank raised the yield on its 4-month internet special today from 5.40% to 5.50% APY. The minimum deposit is $5,000. The 3-month CD yield remains at 5.40% APY.

For more info on Indymac Bank and its CDs, please refer to this previous Indymac CD post.

Some readers in my last Indymac post mentioned that it can be difficult to receive your funds at maturity if you want to close the CD. Even though you can fund the CD with an ACH transfer from your current bank, Indymac won't do an ACH back into that account at maturity. You either have to request that a check be mailed or request a wire transfer in which you'll be hit with a fee. I was told by an Indymac rep that you should be able to have it transfered into an existing Indymac liquid account like their money market or checking account. Once you transfer it there, you should be able to a pull using another bank's ACH system.

Like Countrywide, Indymac Bank has been offering some very high short term rates since last August when news of its mortgage problems started to make headlines. Last month the Mercury News reported that S&P cut Indymac's credit rating to 'junk' level due to the housing problems. So it's definitely wise to stay under the FDIC limits. Please see my FDIC post for more info about what FDIC covers.

Indymac's rating at has been dropping. It's now 1 out of 5 stars (lowest rated) based on 9/30/07 financial data (it was 2 stars on 6/30/07 data). The bank is FDIC insured (FDIC Certificate # 29730).

  Tags: CD rates

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Comment #1 by scott (anonymous) posted on
I have a couple CDs with Indymac, To make it easier to get out I opened the first rate MM, Confirmed that you can have CD transfered to that at maturity. That account has limited check writing and they give you a small order for free. I opened with the $1k min, rate 2% but if you put in $25k rate is 4.90%. So now at maturity I can just have CD transfered to MM and write out a check and deposit locally, But looks like I will be renewing since they have best rates

Comment #2 by Banking Guy (anonymous) posted on
Banking Guy
Thanks Scott for sharing your experience. The only thing I don't like about the First Rate MM is the $1K min balance to avoid fees. But the 4.90% APY is a pretty good yield these days.

Comment #3 by Mitch (anonymous) posted on
I spoke with a CSR this afternoon. Monthly payment of interest on the 4-month CD is available via ACH. Upon closing the account, if the depositor chooses not to receive the proceeds via a mailed check, the wire transfer fee is now $30. The CSR also informed me that if the account is opened by phone, the rate will be held for a period of 12 days during which time the account must be funded. Things are getting tougher for savers when this deal looks really good.....

Comment #4 by Anonymous posted on
I can echo what has been said above... I've had IMB CDs in the past, and never had any problem with them moving the proceeds into a companion IMB MM account at maturity, which then can be pulled from via any outside account's ACH system. Never used IMB's own ACH system, since it carried per use fees.

Also, Banking Guy, I know your feeling.. I also, at your good recommendation, had an Internet First Money Market Account at IMB when its rate was 5.75%... But when they drastically cut the rate in recent months, including down to 2% for the lowest tier, I didn't want to keep the required $1000 just sitting there earning nothing.

So, I called and talked to their customer service about possibly closing the account. But I didn't really want to do that, because 1) by keeping some account there it makes funding IMB CDs (such as their current 4 mo. special much easier and quicker) and 2) I like their ATM card because it carries no fees when used at other bank ATMs and no foreign currency transaction fee (since I'm living abroad now).

The rep suggested, and I agreed, to switch instead to their no-interest Value Checking account, which requires only $100 to open, has no monthly fees, I believe no minimum balance, unlimited check writing, online bill pay, ATM card, etc.

For the value of continuing to use their ATM card and keeping an easy and quick way to access their CDs, it's worth it for me to keep $100 parked there.

The only small hassle factor was while you can initiate the account opening online, you can't fund new accounts via ACH. You have to either walk into a branch with a check, mail in a check, or do a wire transfer to them. (However, if you already have a regular MM or checking account with them, they will move those funds internally in order to fund a new CD with them.

Another small hassle factor when I switched from the MM to their checking account, they said they ha d to cancel my existing ATM card (that was linked to the MM account) and issue a new one with new PIN linked to the checking account. Why they can't simply make that account linking change internally is a mystery to me. Makes no sense.

--John, formerly in Los Angeles

Comment #5 by Anonymous posted on
Hi, I'm in NY and my Indymac CD is up for maturity. I don't want to renew it, however, so I'm wondering if it's better to send them a certified letter or fax it to them. I want to make sure they don't ignore my notice to close my CD - do you think it's necessary, or can you trust them to respond to the faxed notice?

Comment #6 by Banking Guy (anonymous) posted on
Banking Guy
This comment from a reader who closed some Indymac CDs may be helpful.

I would recommend getting online access so you can confirm if the CD has been closed.