Dedicated to Deposits: Deals, Data, and Discussion

E-LOAN's CD Rates and Warnings About CD Maturity

E-LOAN has some competitive mid-term and long-term CD rates. These include a 2.47% APY 24-month CD and a 3.50% APY 60-month CD. Minimum deposit is $10,000. CD must be opened online, and it must be funded using an ACH transfer from an existing checking or savings account. These rates are listed at E-LOAN's interest rates page as of 7/29/09.

E-LOAN's savings account used to be competitive, but in the last year, the rates have been below average for online savings accounts.

When E-LOAN CDs mature, you can have the funds transferred via ACH to the account that was used to originally fund the account, and you can specify the instructions in an online form before maturity. That's a nice feature. However, it's important that you provide the CD maturity instructions before maturity. Here are the instructions that E-LOAN provides:
You may enter CD maturity instructions beginning 60 days prior to maturity. We will accept maturity instructions online up to 5:00 pm Pacific Time on the maturity date. At that time, the last instructions received will become final and cannot be changed. If we do not receive instructions from you before the maturity date, your CD will automatically renew at the rate in effect at the time of renewal.

Your external account must be verified at least 5 business days prior to your CD maturity date.

If you're late with these instructions or late verifying your external account, the CD may automatically renew. If the external account that was used to fund the CD has remained the same, I think you should be okay. However, if this account has been closed, you'll need to link another account and have it verified.

E-LOAN's disclosure does state that there is a grace period:
After an automatic renewal, we allow a ten (10) calendar day "grace period" during which you can withdraw funds without being charged a penalty. The grace period begins on the day after the maturity date of your CD. No interest is paid past the maturity date on accounts closed during the grace period.

I'm not sure why this seems inconsistent with the instructions above. If you want to keep things easy, it would be best to ensure the maturity instructions are provided early. Readers have informed me of various problems with E-LOAN CDs. If you have experience with them, please leave a comment.

Update 12:15pm PDT: I sent an email to E-LOAN asking about the discrepancy between the CD maturity instructions and the grace period mentioned in the disclosure. Here is what I received:

To close a CD account that is within its grace period, please send a detailed Secure Message with the last 4 numbers of the account to be closed.

Upon closure, all funds will be sent via an electronic Automated Clearing House (ACH) transfer to the most recently verified linked account on file.

This may take 2-4 business days to be completed.

So it appears you can close the CD during the grace period, but you just can't use the form.

E-LOAN is a subsidiary of Banco Popular North America (BPNA), a New York state chartered bank. E-LOAN's deposit products are insured by the FDIC through BPNA (FDIC Certificate # 34967). BPNA's ratings for safety and soundness have gone down quite a bit and are now at the lowest levels at both BauerFinancial and based on 3/31/09 financial data.

Other High Certificate of Deposit Rates

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Comment #1 by Anonymous posted on
Thanks Banking Guy, I have a CD maturing in November and just left myself a google calendar alert to deal with this issue on 10/1.

Comment #2 by Matthew (anonymous) posted on
I don't think the grace period is inconsistent with the other instructions you referred to. Many banks will allow you to change your maturity option prior to the maturity date, with renewing the CD being the default option. Then, you have the grace period during which you can cancel or change the term of the new CD without penalty. So, I don''t think the instructions about changing maturity option mean that is the ONLY way to prevent your CD from maturing; it may, however, be more convenient to setup the maturity option in advance.

Comment #3 by Anonymous posted on
I strongly warn against doing any business with eLoan. I previously wrote in about my experience about two months ago. In my opinion, they are outright criminals!

I feel so strongly about what I see as their criminal actions that I really think Banking Guy should bar them from his listings.

They thwarted me in getting my money back at EVERY turn. It took a week and a half past maturity to get it, and with no interest that entire time. And nothing of what they did to thwart me was in their disclosure.

They made up rules at the last minute that were not part of the disclosure -- like they would not allow me to change my external account within seven days of maturity -- nothing in the disclosure about that, and you only find out when you try to do it (I tried it five days in advance, after being told on the phone three weeks before that that I could do it right up until the CD matured). And that was only one of several things they threw up to block me from closing and getting my money -- none of it in the disclosure.

And they were stone cold about it all, would do nothing to help. It was deliberate and connivingly planned.

Stay away from eLoan no matter what.

Rest assured, Banking Guy's mention about some problems and to please let him know if you have any is in this listing for a reason.

Comment #4 by Anonymous posted on
I opened up a CD a few years ago. Although I had no problems getting my money out, there's a few things that I disliked:

1. I linked an external account do initiate the ACH transfer. Due to a glitch, E-LOAN initiated 6 verification trial deposits/withdrawls. Of course, my external account has a 6 transaction limit.

2. Many features of their online banking are down usually at night. I don't have a concrete number, but it's more frequent than the average once-per-week that most banks follow.

3. Even after I instructed them I wanted no spam via phone/email/mail, I still received "special offers" from their parent company, Banco Popular.

Overall, I'm not impressed with them. While the experience wasn't horrendous, I can receive better service and rates from other banks/CUs.

Comment #5 by Anonymous posted on
Pay close attention to your online account balance with E-Loan. I just had to inquire about bonus money that was still missing from my account on a promotional CD since December 2008. I'm not sure if this was an oversite or done on purpose.