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Update on the 4.07% 18-Month CD ($25K Max) at Citibank via its Secured MasterCard Program

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Citibank

Update 2/22/2010: Citi's website now states the maximum CD deposit is $5,000.

Citibank continues to offer a 4.07% APY 18-month CD as part of its Citi Secured MasterCard program. I first posted on this deal in early August. The 4.07% APY is still listed as of 12/22/09 in the Additional Disclosures. The link to this disclosure is located at the bottom of the Citi Secured MasterCard page. It's surprising to see the rate still this high. As I mentioned before, it's possible that the credit card division didn't give much thought about CD rates. It may be an example of an oversight by the bureaucracy of a large company.

I described the CD details in this September post. A few important details include:

  • $25,000 maximum deposit
  • Must also apply for secured credit card which has an annual fee of $29 (Will likely require two $29 charges during life of CD)

A reader mentioned this Bankrate article on secured credit cards if you want to learn more about these. They're intended for those with poor credit history, and there have been reports that Citi will reject your application if your credit is too good. However, several readers who have very good credit have reported success in opening this CD. Not all have been successful. A few have reported that they were denied because of TeleCheck. As one reader commented, their online application is new, and apparently quite clunky. You might have better luck applying by mail. Another thing to note is that most everyone who has contacted Citibank about this promo has been disappointed by their customer service.

One bit of uncertainity is how timely will the funds be received at maturity. One reader reported the following:

Be aware folks that receiving your funds timely will be challenging. I talked to the "presidential office" to find out the details which are not published. It appears there is a half dozen scenarios when the CD matures. The worst could be in excess of six weeks or longer. The best scenario is the following. Citi sends out notice 30 days prior to maturity. At least 60 days prior to maturity stop charging. When you receive maturity notice notify Citi you do not want to renew. This gives 4-6 weeks without charge card activity. The check will be mailed 7-14 days later. You need to start the clock prior to maturity date. Also it was recommended to use the card at least once every 6 months otherwise Citi may cancel the card.


If you have given this CD a try, please comment about your experience. Refer to the comments of my August and September posts to read all the reviews.


  Tags: Citibank, CD rates

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Comments
15 Comments.
Comment #1 by john (anonymous) posted on
john
I have two of these. They dated the cds' the day they received my checks. I opened them about 3 weeks apart. My credit is good. I am thinking of opening a third. I do not intend to use the cards. I intend to cash them both out at maturity and cancel or not renew the cards. So far all seems well.

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Comment #2 by Amit (anonymous) posted on
Amit
I have a good credit history and was approved using paper application. Most people are denied using the online application using TeleCheck because of a denial from TeleCheck. Reason being they have never done any activity using TeleCheck and TeleCheck will not approve such a large sum (this happened for my wife's application). But so far so good.

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Comment #3 by Anonymous posted on
Anonymous
I thought about opening one when they were first mentioned some months back. Seems I would be a perfect candidate because I have little credit history bad or good.

Will they mail you a monthly interest check? I rely on interest income to survive.

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Comment #4 by Mark (anonymous) posted on
Mark
I have very good credit, but I was able to open a CD (and receive the credit card, which I don't intend to use except for paying the annual fee) a month or two ago. The application process by mail was quite inefficient. Initially, the bank returned my application and check to me without any explanation. When I called to find out what the problem was, the CSR was unable to offer an explanation, but she suggested that I send my application and check back to them, which I did. Again, the bank returned my application and check to me without any explanation. I called again and received the same advice. I figured that I would give one final try. Lo and behold, Citibank processed it without a hitch the third time. Considering the rate of the CD, I'm glad I persisted.

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Comment #5 by Anonymous posted on
Anonymous
I was turned off twice, once online once mail in application.
I have Good credit.

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Comment #6 by Anonymous posted on
Anonymous
I heard over at creditboards that approval is not denied due to too good credit but if you already have a unsecured citi card then you will be denied for this one.

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Comment #7 by Anonymous posted on
Anonymous
I opened my account last month. I have excellent credit. I was rejected twice by TeleCheck. When Citi sent me a letter, they stated that I was rejected because my requested CD amount was over 5K. (I get the impression that TeleCheck rejects requests over 5K.) I sent in the application with a check and I have had no problems since then. The CD was opened the same day that they received the check. So far, so good.

To the first poster, John. I never thought of opening more than one of these. I'm somewhat surprised that Citi hasn't caught on yet!

Merry Christmas to all!

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Comment #8 by Anonymous posted on
Anonymous
I tried to apply online but telecheck rejected my savings account and the app restarted, I applied again by mail and just received the card.
I have good credit, not that it counts for anything, I've been RJ'd by everyone.
Hopefully doubling my open credit doesn't set off too many alarms with my current cc issuers.

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Comment #9 by Anonymous posted on
Anonymous
For someone who asked about receiving a monthly interest check, this CD does not. In fact it is a pseudo-CD. You don't actually have an account number for the CD but rather a corresponding credit card account number. You get a credit card statement every month saying how much interest your CD have gained. After maturity will you then receive you principle along with your earned interest.

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Comment #10 by Anonymous posted on
Anonymous
Do they pull your CR before TeleCheck rejects?
Has anyone who has account at CITI been able to open 25k CD online successfully? As I am traveling, it would be easier for me to apply online and I do have accounts at CITI.
Thanks in advance,

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Comment #11 by Anonymous posted on
Anonymous
Applied for my second CD before Christmas. I got the phone call today that they issued the second credit card as of today.

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Comment #12 by Anonymous posted on
Anonymous
Did you apply online and if so, was the amount 5k+?

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Comment #13 by Anonymous posted on
Anonymous
To Anonymous Dec 26: No, if applying online you must past Telecheck (I did not) before the app even gets to Citibank! Yes, I was rejected because Telecheck would not approve my $25,000 application--even though the funds were to be pulled from my Citibank checking account which I've had for 31 years!! You know, left pocket into right pocket. CSRs were not helpful. Most did not even know about the program. One person who did suggested I go into a branch--I now live in Florida and the nearest branch is over 100 miles away. I gave up. I imagine I was also a "risky" customer since I have absolutely sterling credit.

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Comment #14 by Anonymous posted on
Anonymous
To those who were rejected by telecheck I would suggest to mail the application. After I got rejected by telecheck, I sent the application by regular mail and was approved right away.

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Comment #16 by larkin (anonymous) posted on
larkin
January 21--mailed check

January 25--check cashed; CD opened

February 4--received phone call confirming application had been approved

February 8--received details on the CD via snail mail (4.07% APY/18-month term confirmed)

I am waiting for the credit card but the process has been smooth.  The letter I received on the 8th confirmed that the CD was opened the same day the check was cashed.  One caveat--the CSRs have limited knowledge on how the CD works so do not expect much there.  I have been told that your CD balance will be posted on your monthly cc statement.

 

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