Dedicated to Deposits: Deals, Data, and Discussion

10% 6-Month CD ($2.5K Max) and Other Promos and News at Flagstar Bank

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Flagstar Bank
Flagstar Bank is offering a new 6-month CD promotion with a yield of 10.00% APY. The minimum deposit is $500, and the maximum deposit is $2,500. It does require you to jump through some hoops. A new checking account is required, and you must have at least 15 transactions (can include online bill payments, debits and credits). Instead of the 15 transactions, it appears you can also satisfy the CD requirement with $250 direct deposit of income per month. A $100 penalty may be imposed if the checking is closed before 6 months or if you fail to meet the transaction requirements.

This special is not listed at Flagstar's website. It was advertised in yesterday's Fort Wayne News Sentinel. The ad is available online here.

Other Flagstar Promotions

This CD special is more like a checking account bonus. If you have $2,500, the 10% will earn you about $87 more than a 3% account for 6 months. You may be better off with Flagstar's $100 gas card checking account bonus which still seems to be available (see post). I don't know if they would allow you to do both, but it may be worth a try.

The gas card promotion is only available in the three states where Flagstar has branches (Georgia, Michigan and Indiana). I would guess this CD promotion has the same limitation.

Matching CD Rates

Readers have informed me that Flagstar will beat any CD rate by 0.05% from a bank within the same county. Another reader reported that Flagstar in Georgia applies this to the entire state. So you can see if you can use this to get a 4% CD (see post).

Flagstar's Express Money Market Account

Flagstar continues to have one of the best online money market accounts, and it's available to people in any state (see post).

Financial Health

Flagstar has been hit hard by the mortgage crisis. It has only a 1 out of 5 star rating at Bankrate.com based on 12/31/07 data. Flagstar Bancorp reported last week a loss for the first quarter, but it's showing some improvements (see article). As with any bank, always keep below the FDIC limits (Flagstar FDIC Certificate # 32541).

  Tags: Indiana, Flagstar Bank, Georgia, Michigan, CD rates

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Comments
5 Comments.
Comment #1 by Anonymous posted on
Anonymous
15 transactions over the 6 months or for every month of the 6 months?

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Comment #2 by Anonymous posted on
Anonymous
I recently opened a money market promo account with Flagstar. Their rate is okay and I had several Cd's maturing that I don't want to renew and thought this would be the easiest way to get the money. They advertise free checks for life but when I got my first statement I was charged $8.95 for checks. Has anyone else had this problem.

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Comment #3 by Banking Guy (anonymous) posted on
Banking Guy
About the 15 transactions, at first I thought this was 15/month, but after re-reading the small print). One reported receiving the first 150 free at least. I think you should be able to get them to credit you this amount since their website has stated "Free checks for life" since July 2007.

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Comment #4 by Anonymous posted on
Anonymous
Hey banking guy... I spoke to a CSR. She said it's 15 PER month (i.e. a minimum of 90 over the 6 month period).

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Comment #5 by Banking Guy (anonymous) posted on
Banking Guy
Thanks for checking on this and commenting. I was afraid it was 15/month. Sounds like a version of a reward checking account but with a much smaller balance cap. But it appears that an ACH transfer would qualify as a transaction and these would be easy to set up if you had an online bank account.

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