Dedicated to Deposits: Deals, Data, and Discussion

4.50% 12-Month Online CD at WaMu

POSTED ON BY

Update 9/26/08: WaMu closed. JPMorgan Chase acquires WaMu's banking operations. Please refer to this post for more details.

Update 8/23/08: WaMu has increased the Online CD yield to 5.00% APY on terms of 12 and 13 months.

Washington Mutual just increased the yield on its online 12 and 13-month CDs from 4.25% to 4.50% APY. The 8-month CD yield remains at 4.25% APY. The minimum deposit is $1,000.

For details about opening and closing WaMu Online CDs, please refer to this July 5th post. Several readers have commented about their experiences opening a WaMu Online CD in my last WaMu CD post. Some of the details mentioned included:
  • 5 Lexus Nexus type verification questions asked during the online application
  • CD can be funded with an ACH transfer from an external account. Two small deposit amounts are used to verify the account. Also, the deposits are followed by a withdrawal of the sum of the two deposits.
  • The application did not provide fields for POD beneficiary info
  • Early withdrawal penalty for a 12-month term is 180 days of interest on the amount withdrawn.
Many readers have reported problems with WaMu's customer service. Here are excerpts of some of the issues that were reported:
  • After 15 minutes on hold at their 800#. I gave up.
  • My account is STILL not funded. They STILL haven't sent me an email and responses to 3 bankmails have been canned BS responses that they can't do anything unless I call.
However, if you are able to go through the application without complications and without a need to contact the CSRs, you may be okay. Here's one comment showing some positive experiences:
I opened an online CD in 5 minutes transferring the money from my WaMu checking account which I had just transferred from an external account. All my transactions and external transfers with WaMu online have been fine except that the outgoing transfers seem to take much longer than the incoming ones.

With this very high CD yield and the WaMu's recent big rate increase of its Online Savings Account (see post), WaMu is looking like it's desperate for deposits as it struggles with huge loan losses. Latest news shows WaMu is having success at raising more capital. Last week a UK hedge fund bought a 6% stake in Washington Mutual.

As I recommend with any bank, make sure you stay under the FDIC limits. WaMu is FDIC insured under two banks (Washington Mutual Bank FSB and Washington Mutual Bank). This WaMu page provides more details of FDIC insurance and WaMu's two FDIC-insured banks. Note, there's no mention about the ability to have deposits under both banks to double your FDIC insurance.

To review all of my recent WaMu posts, please refer to this page. WaMu continues to offer Traditional 5% CDs for terms of 48-months and longer (see post).

Thanks to the reader who mentioned this new rate increase.
  Tags: CD rates

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Comments
19 comments.
Comment #1 by Anonymous posted on
Anonymous
I opened a online CD and online savings account recently. transfers take more days but everything will be fine if you wait a bit.

1
Comment #2 by Anonymous posted on
Anonymous
just beware! i deposited a check from a cd that matured from another bank and they put a 10day hold -- meaning i am losing 10 days interest now! then your call goes to the phillipines for cust service which is no help at all. their service sucks

1
Comment #3 by Anonymous posted on
Anonymous
External transfers initiated from the external bank are credited and available the next day, but transfers initiated from the WaMu side are delayed three days outgoing and held five days incoming. POD CD's require a branch visit to get the title changed, but that can be done any time after opening the CD online. The two bank thing is a legacy from when they bought some other bank and merged it into WaMu -- accounts left over from before the merge are insured under the defunct bank's old FDIC certificate number, but all new deposits are insured under the purchaser's (i.e., WaMu's) certificate number -- you cannot double your insurance by somehow opening accounts under both certificates.

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Comment #4 by Anonymous posted on
Anonymous
FYI, if you deposit a held check into an interest-bearing account, you don't lose interest during the hold. I've also never had trouble getting a hold waived, at least temporarily.

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Comment #5 by Anonymous posted on
Anonymous
The comment above is incorrect as this varies from bank to bank.

Pretty sure the account disclosures of WAMU say that interest accrues when funds are collected for the savings account.

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Comment #6 by Anonymous posted on
Anonymous
The checks MUST be cleared,
before they start earning interest as per CSR.

Clearing can take from one day for certified checks and up to 10 days for out of state institutions (Banks) or customers.

No exceptions allowed.

1
Comment #7 by Anonymous posted on
Anonymous
I agree with poster from 10:02 AM.

I'm from New York and was transfered to Texas temporary from my job.

I opened a checking account at Wamu in Dallas and deposited personal check from New York Bank and waited 2 weeks for the funds to clear.

No interest was posted in the saving account for that period.

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Comment #8 by Anonymous posted on
Anonymous
"The checks MUST be cleared,
before they start earning interest as per CSR.

Clearing can take from one day for certified checks and up to 10 days for out of state institutions (Banks) or customers.

No exceptions allowed."

This is absolutely and categorically incorrect.

Non-cash items deposited begin accruing interest on the date of deposit, as per their disclosure. The CSR gave completely BS info.

If you deposit a check today--even if a 10 day hold is placed on it--you begin earning interest TODAY, not even tomorrow but TODAY!

Any info stating otherwise offered to you by a CSR is just plain wrong, period!

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Comment #9 by Anonymous posted on
Anonymous
i am the one who posted about the hold for 10days. thanks to all who replied! i feel that WAMU should be more clear on their policy and at the least, have their CSR know the policy as the answers are all over the place LOL!, regardless, theey are using my money and not paying me interest -- just shows how desperate they are for funds. again, I feel their service sucks!!! but -- once this mess clears and i dont have to deal with them, i will be OK with 4.5%, its better than the 3.4% i was getting at ING that is for sure :)

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Comment #10 by V (anonymous) posted on
V
What's with the constant misinformation on this board. I am poster 9:13AM.


INTEREST IS ONLY EARNED ON COLLECTED FUNDS FOR THE SAVINGS ACCOUNT


Please only quote from the Account Disclosures and Regulations and not something that is your opinion.

"interest rate and APY paid on the balance deemed to be collected in your account"

"Interest on any interest bearing account (except as set forth below) will accrue on the account daily on the balance
deemed collected (determined as set forth in the Balance Calculation/Determining Collected Balance section of these
Account Disclosures and Regulations); PROVIDED THAT, if such other deposit is made to any School Savings®
account, any CD, or a deposit account opened in connection with a Washington Mutual Retirement or CESA Plan, the
deposit will begin earning interest on the Business Day the deposit is made."

So unless it's a CD, retirement account, etc.. funds need to be collected before interest is earned.

I'm still LOL at poster 1:04PM. I'm surprised how he/she thinks they are 100% correct when its the exactly opposite.

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Comment #11 by Anonymous posted on
Anonymous
WaMu sucks!

They put a 10 business days hold on deposits, and they won't remove the hold. I called and asked.

WaMu is really tough to deal with sometimes.

When you call their toll-free number you sometimes get a rep with a foreign accent who really doesn't know too much.

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Comment #12 by Anonymous posted on
Anonymous
Beware of WaMu....you can't transfer funds of more than $10K per day...didn't see that anywhere until I called their CSR. To get all of your money over $10K you either have to stagger withdrawals over the course of days or get a bank check which has to be held a few days when it's cashed....VERY ANNOYED....haven't run into other online banks with that restriction.

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Comment #13 by V (anonymous) posted on
V
Bank checks will clear the next business day. If you want to ACH a large amount just push the transaction. I've see a number of banks impose limits on incoming/outgoing transactions.

To expedite the 10 day hold just talk to the manger at your branch. They can usually check the transaction in 3 business days any release the funds.

1
Comment #14 by Anonymous posted on
Anonymous
I don't think that it matters what the "Account Disclosures and Regulations" says; they credit you interest for held deposits.

As far as I can tell, a hold only stops you from withdrawing the funds.

1
Comment #15 by henry (anonymous) posted on
henry
Inymac is matching WAMU 4.5 APY rate. Just ask. I rolled over all my exisiting CD even before their maturity to 1 yr rate of 4.5. They will ask to see the URL to confirm the rate before doing it. I showed them our secret tool..bank deals website. It was fast and smooth. Thanks banking guy. I got the idea from reading your comment about rate matching.

1
Comment #16 by Anonymous posted on
Anonymous
Just visited the local branch and they are offering the 4.5% APY on the 13 month CD in the branch. Customer service there was great. The even offered me a relationship rate increment just above this 4.5% APY. No complaints here.

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Comment #17 by Anonymous posted on
Anonymous
the branch told me that I have to open a checking account with the CD. The way they said it is like they don't care.

1
Comment #18 by Anonymous posted on
Anonymous
Today I was able to open a 13 month CD at 4.5% at a Chicago branch. Checking account was not necessary.

1
Comment #19 by jwbodnar (anonymous) posted on
jwbodnar
There are some benefits to getting to know your local WaMu branch.

One is getting holds waived or shortened. I deposited a $22K check last Saturday, and they put a 5-day hold on the first $5K and a 10-day hold on the remainder. Branch manager said to see here after 5 days, and she'd try to get the remaining hold waived.

Went in after 4 days and told the manager I wanted to open a CD (which is true), and they lifted the hold on all funds, not just the amount I put in the CD.

Second, the online promo CDs are often available in branch. The benefit of opening in branch is that you can usually add money to a promo CD, up to the amount of the initial deposit. So, I opened a $19.5K CD, and I can add up to $19.5K before the CD matures in 8 months. You can't do that with the online CDs, probably because they just don't have any way of making the web site understand how it works yet.

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