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GMAC Bank's New Online Savings Account

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Update 10/24/08: The yield has gone back up to 3.75% APY.

Update 10/17/08: The Online Savings Account yield has fallen to 3.60% APY.

Update 10/10/08: The Online Savings Account yield has increased from 3.55% to 3.75% APY.

Update 9/27/08: The new Online Savings Account is now listed at GMAC Bank's website. Account applications can now be done online.

GMAC Bank has just started a new online savings account with a yield of 3.55% APY for balances over $500 (3.45% APY for under $500). This is 55 basis points above the Money Market Savings yield. The main downside with the new Online Savings Account is that it has no check writing and no debit cards.

This new account isn't listed at GMAC Bank's website. It's only for existing customers with a Money Market Savings Account. According to the CSR, this just started, and they plan to make it available on their website for everyone sometime in the future.

My Experience Opening the Online Savings Account

A reader mentioned receiving a letter from GMAC with an invitation to switch his existing Money Market Savings into this Online Savings Account. I haven't received this letter yet, so I called and asked about it. The CSR said that I was eligible for this new account. The reader said the letter only gave the option of switching over the old account to this new one. However, the CSR said you can also just add this new online savings account and keep your old Money Market Savings Account. She said this could be done by phone, so I went ahead and had it done.

The CSR funded this account with money from my Money Market Savings Account. It was done very quickly. After the call, I logged in, and it was already set up with the money transfered. The new account also shows up in the transfer page so I can transfer into and out of this account using all my linked accounts.

The only little glitch was that it was listing the 3.45% APY instead of the 3.55% APY for a minimum balance of $500. I called back and the CSR confirmed that it should be 3.55% APY and said they will look into this. Since it's a new account, perhaps they're still a few small glitches.

Update 9/10/08: I logged into my account, and it now shows 3.55% APY for my new Online Savings Account. A GMAC rep actually called me about this yesterday. I asked again about the minimum balance requirements of this new account, and the CSR said that both the minimum balance and the fees are the same as the Money Market Savings Account.

Details of the Online Savings Account

Here are some details about this new Online Savings Account that I was told by the CSR. Let me know if you receive different info. Since it's new, there may be mistakes. They're mailing me a welcome kit which should include these details in writing.
  • 3.55% APY for balances $500 and above
  • 3.45% APY for under $500
  • Minimum initial deposit is $50
  • Minimum balance to avoid a monthly fee is $500
  • $7.50 monthly fee if balance is under $500 ($5 with direct deposit)
  • $10 fee for more than 6 withdrawals per month
  • Internal withdrawals count towards the 6
  • The 6 withdrawal limit applies separately to the savings and MMS
Update 10/10/08: A reader clarified the minimum balance policy: "As for minimums, it is $500 in an account OR $1000 in all GMAC accounts. This includes CD's, so $999 in a CD and $1 in OSA will avoid fee."

I was happy that they allowed me to open a new account rather than convert my existing account. I don't use checks that often, but I do use them every now and then (can be useful for funding a CD).

The yield on GMAC's MMS account has been lagging for much of this year. It has remained at 3% APY while many others have been 3.50% and above. So I'm glad to see GMAC adding this account if it can allow them to be more competitive. This is similar to what Capital One has done with its Online Savings Account.

My Past Experience with GMAC's Money Market Savings Account

I've been very happy with my GMAC MMS account. The ACH transfers are fast. The holds are short. External links are easy to set up, and there doesn't seem to be a limit on the number of links. I have more details about this MMS account in my GMAC MMS account review. I also have the rate history of this account for the last two years. The yield has held at 3% APY since 2/29/08.

GMAC in the News

GMAC Bank's parent has been in the news lately due to its troubled mortgage lending arm, Residential Capital (ResCap). Latest news is that ResCap is is cutting 60% of its workforce to cope with the continued weakness in the housing and credit markets. According to the article, ResCap has posted 7 consecutive quarters of losses, totalling $7.2 billion. I don't know how this directly affects GMAC Bank which still has decent financial ratings. These are based on 3/31/08 data, but as you can see, ResCap has been having problems for a long time. GMAC Bank has a 4-star rating (sound) at Bankrate.com and a 4-star rating (excellent) at BauerFinancial.

Update 10/10/08: GMAC Bank's financial ratings for soundness have gone down since the initial post. Bankrate's safe & sound rating has gone down from 4 to 3 stars (performing). BauerFinancial's rating decreased from 4 stars to 3.5 stars (good). Both ratings are based on 6/30/08 data.

FDIC Coverage

As I recommend with any bank, make sure to keep your deposits under the FDIC limits. For issues on FDIC coverage above $100K, please refer to this recent post, and for more details, refer to this post. GMAC Bank accounts are FDIC insured (FDIC Certificate # 57803).

Thanks to the reader who mentioned this new account in the comments.
  Tags: savings account

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Comments
29 comments.
Comment #1 by Perturbance (anonymous) posted on
Perturbance
Thanks for filling in the blanks on this deal, Banking Guy!

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Comment #2 by Anonymous posted on
Anonymous
$5 monthly fee if combined balance is under $1,000 and with direct deposit. Otherwise, the fee is $7.5.

--H

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Comment #3 by Anonymous posted on
Anonymous
Even tho I haven't received the invitation letter, I'm an existing GMAC Bank accountholder so it was very easy to set up the new account with a phone call and have the CSR transfer some money in from my existing account.

Per the CSR:
-The existing external links will work with both accounts.
-You can add beneficiaries at any time by phone or mail (nor sure about online). You need to give GMAC their name, DOB and physical address but not the beneficiary's SSN.

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Comment #4 by Anonymous posted on
Anonymous
I just opened the new Online Savings Account and my rate also only shows 3.45%APY. I'll let it sit for a few days before calling back. Did your rate change to 3.55%APY?

1
Comment #5 by Anonymous posted on
Anonymous
Heh Banking Guy: I'm like you in that I've been very pleased with my GMAC Insured Savings account and this will be a very nice complement to it with the higher yield ... thanks for the heads up! I went ahead and set up the new account yesterday with a transfer from my GMAC Insured Savings and everything went perfectly. One question ... have you confirmed that the new Online Savings accounts are also FDIC insured? Thanks again.

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Comment #6 by Anonymous posted on
Anonymous
Hello again: I just asked the question about FDIC insurance and the new Online Savings acount. I had also sent E-Mailed the same question to GMAC and they confirmed that it is also FDIC insured. Here is their response FYI ...

Thank you for choosing GMAC Bank. Absolutely, the Money Market Saving accounts are FDIC Insured up to $100,000.00 per depositor per account titling.

For further assistance please contact us via this secure email option or give our Customer Care Department a call and we will be happy to assist you with your banking needs. Our toll free number is 1-866-246-2265. You can reach us Monday through Friday from 9:00 am to 9:00 pm and Saturdays from 10:00 am to 5:00 pm EST.

Thank you,
PEllsworth
Customer Care
GMAC Bank

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Comment #7 by Anonymous posted on
Anonymous
I called GMAC today about converting my account and getting the 0.55% additional interest. The CSR said that they had mailed out a letter to every account holder and it has a coupon to use to do the conversion. He said the ONLY way to convert the account is to wait for the coupon, mail it in and then wait for it to be processed. I complained that I had hoped to make the conversion over the phone and not have to wait 2 weeks. He said that I did not have a choice. I could open the new account in addition. I guess I could open the new account, transfer the money and then call up the next day and close the old account? Just seems like their CSR's are not very customer oriented. I guess they have tens of thousands of accounts and expect most customers to want to convert. Too much for their help desk staff.

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Comment #8 by Anonymous posted on
Anonymous
since the old account has checks and a debit card, why would you want to close it and use an account that will only ACH out your money?

1
Comment #9 by Anonymous posted on
Anonymous
GMAC rating now down to 3*

1
Comment #10 by Jim McMahon (anonymous) posted on
Jim McMahon
I called GMAC Bank today to try to switch my MMDA account to the new online savings account but was also informed that the only way to switch was to reply to the letter that I should be receiving shortly. I also have a GMAC Bank checking account from when they offered them a few years ago so I don't have a problem with the limited access to this new account since I can easily transfer funds from one account to the other. However, it wasn't very customer friendly to make me wait to switch my account to get the higher yield.

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Comment #11 by Anonymous posted on
Anonymous
I emailed them about having to wait for the US mail coupon to convert. Apparently when you use the coupon you keep the same account number.

Has anyone received their conversion coupon yet? They claim they were mailed out 5 days ago.

I have several other high interest online accounts with check writing. I really dont need 2 accounts at GMAC. My main use for the GMAC account is as an ACH router to the many accounts I have that do not have their own ACH capability. I definately would rather get 3.55% than 3.0% !!!

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Comment #12 by Jim McMahon (anonymous) posted on
Jim McMahon
I contacted GMAC Bank today. The conversion letters are being sent out in waves with the last batch scheduled to be sent out this Friday (9/12). Everyone should receive a letter by next week. Apparently they need your signature to either convert the account or open up a new one. They need it on order to remove ATM access for the new account for those that have an existing ATM card.

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Comment #13 by nejeff (anonymous) posted on
nejeff
Could you clarify what you meant by "The only downside that I see for opening this new account is the higher minimum balance requirement ($1,000 instead of $500)."? I understood the minimum account balance was $500 to avoid fees.

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Comment #14 by Anonymous posted on
Anonymous
Just received the letter. Addendum says avg daily balance on account "is Greater than $500 OR Combined Cycle Date Balance of all GMAC Bank Deposits Accounts is Greater than $1000" to have no service charge. So sounds like only need 500 (but will get slightly lower interest rate). I'm unclear though if have 1000 in CD's does that count? And what if have 1000 in CDs and $1 in account?

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Comment #15 by Anonymous posted on
Anonymous
Just called GMAC and received clarification. By phone, can open a new account (MMSA will still be open). If want to convert MMSA to OSA, then need to mail in form. Converting means the acct number stays the same (so any links to other banks you do not need to change). As for minimums, it is 500 in account OR 1000 in all GMAC accounts. This includes CD's, so 999 in a CD and 1 in OSA will avoid fee.

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Comment #16 by jh (anonymous) posted on
jh
Any other updates on the interest rate? I just opened one of these accounts and the summary shows APY @ 3.45% (not 3.55% per the mailer).

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Comment #17 by Anonymous posted on
Anonymous
I finally got my letter today. Now we will see how long it takes them to do the conversion...

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Comment #18 by Anonymous posted on
Anonymous
I got my Online Savings letter today (9/15). However, I am not very savy about electronic transfers except within my local bank checking account and an online savings account at the same bank. That I do regularly with no problem.

I would change to MMSAs wit GMAC if I knew more about how the electronic transfer will work when I do not have a checking account with them. Anyone help instead of my having to call CS?

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Comment #19 by Anonymous posted on
Anonymous
Sorry, I should have said I would change my MMSAs to GMAC Online Savings . . . etc.

1
Comment #20 by jh (anonymous) posted on
jh
To answer my own question: the interest rate now shows as 3.55% APY. I guess their software needs a day to think about it!

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Comment #21 by Anonymous posted on
Anonymous
Oh, for heaven's sake... Relax!

Wait a few days after opening the account before you start to worry. I opened one of these Online Savings accts last week with a balance over $500. I opted to open this acct in addition to my Money Mkt savings acct (rather than converting the latter), and the 3.55% APY was listed correctly when I checked my accounts on their Web site two nights ago.

Thanks again, Banking Guy, for the early heads-up on this account. I did not receive the letter from GMAC Bank, inviting me to convert my existing Money Mkt acct, until yesterday.

Oh, and for those who are reluctant to phone GMAC Bank in order to get information and answers from their customer support personnel, chill out. I have always found them to be pleasant and helpful on the phone. In fact, I opened this Online Savings acct by phone, transferring money from my Money Mkt acct to do so. It couldn't have been easier.

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Comment #22 by Anonymous posted on
Anonymous
Regarding the 3.44% vs. 3.55% rate:

I believe the reason it shows 3.44% initially is because that is the lower default rate for balances below the minimum balance threshold ($500?).

Once your funds POST to the account (I believe this happens in the evenings after the business day has "closed") and your balance is above the minimum balance threshold, you'll immediately be bumped up to the higher 3.55% rate.

I believe this is why many of the posters here have seen their rate increase to 3.55% once they've come back to check their rates online after they have funded the account.

And...on the other issue:
Even though I received the letter I still called them up (using the phone number on the letter) on 9/17/2008 to open the higher rate online savings account rather than mailing it in. The truth is, I didn't want to shutdown my money market account (with check writing and debit card) or "convert" it to the online savings account - I wanted *both* accounts-, so I simply added/opened the online savings account and kept the money market account. I had no trouble doing this over the phone.

-DTS

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Comment #23 by Anonymous posted on
Anonymous
Is there any problems transfering money from bank to bank online. Like HSBC and ING to GMAC? In other words, opening an account with GMAC online without calling or mailing a check. I am thinkig of getting some CDs. Thanks

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Comment #24 by GMAC article (anonymous) posted on
GMAC article
In case anyone missed it, GMAC Bank was also in the news recently about it's FDIC insurance. See link above.

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Comment #25 by Anonymous posted on
Anonymous
I converted my account to online savings; it took 5 days to show up online with correct interest APY 3.55%. Yesterday I received a letter saying $15 charge to stop payment checks. I promptly gave call and I was told that letter sent out in error. Bank has not debited account and it will not do it.
Has anyone received this letter?

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Comment #26 by larkin (anonymous) posted on
larkin
Online Savings now showing on GMAC home page...

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Comment #27 by Anonymous posted on
Anonymous
I have read that GMAC bank may not be FDIC insured after NOVember 30 2008 due to an agreement signed in2006 between them and General Motors,. DOes anyone have any information about this. I have a large amount of information about this but it is difficult to figure out with all the legal wording.Thank YOu Gloria

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Comment #28 by Banking Guy (anonymous) posted on
Banking Guy
GMAC got a 10-year waiver. I have more info on this at the bottom of this post

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Comment #29 by Anonymous posted on
Anonymous
Banking Guy,

Do you know if they did hard pull on your credit when you open the new online saving? Thank you.

Dave

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