Dedicated to Deposits: Deals, Data, and Discussion

New High-Yield Online Savings Account at Ready Saver - Available Nationwide

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Southern Community Bank & Trust

Update 1/12/2011: The rate has fallen to 0.90% APY.

Southern Community Bank and Trust has a new online savings account called the Ready Saver Account. It's a no-minimum and no-fee online savings account. It currently has a very competitive rate of 2.00% APY for all balances as of 2/15/2010.

The bank's About Ready Saver page has a few details:

  • Can only be opened online
  • Not available for North Carolina residents
  • Minimum initial deposit is only $1
  • No monthly service fees or other hidden charges
  • No rate tiers
  • interest accrues monthly
  • monthly e-statement
  • ACH bank-to-bank transfer service with automatic transfers

There are a few more details in the Ready Saver Truth-in Savings disclosure. Some details not mentioned above include:

  • Interest rate on your account may change at any time.
  • If you close your account before interest is credited, you will not receive the accrued interest.
  • Minimum monthly required activity - You must sign into and access your online banking account monthly to verify you have access to your eStatement.
  • $3.00 fee per withdrawal in excess of 6 withdrawals per month.
  • A maximum of $15,000 in electronic transfers on any defined banking day (Update 2/16/10: Based on info from CSR, this does not seem to be enforced - see update below)

Update 2/17/10: A long-time reader contacted the bank and received many account details (see below). Some important issues to highlight:

  1. They do a hard credit pull with Equifax for all new accounts
  2. Any debit transactions in excess of 9 cumulative per calendar quarter are assessed a $3 service charge each.
  3. They do not link (store) external accounts for transfers like most other online banks, so you need to enter the account information each time you want to initiate an ACH debit/credit.

One thing to note about the Ready Saver online application is that it uses the same service (secureinternetbank.com) that is used by Southern Community Bank and Trust's website to open the reward checking account. With new internet banking websites, it's always a good idea to confirm the link with the parent bank. Southern Community Bank and Trust has been a FDIC member since 1996 (FDIC Certificate # 34321).

Southern Community Bank and Trust has its headquarters in Winston Salem with branches in several North Carolina cities including Asheville, Greensboro, Winston-Salem and Raleigh. I guess they're excluding NC residents so they can bring in only new money.

The bank's ratings for safety and soundness are mixed: 3½ stars (good) at BauerFinancial and 1 star (lowest) at Bankrate.com. Both ratings are based on 9/30/09 financial data.

Rate Chaser's Worries

As I mentioned this morning in my reward checking post, Southern Community Bank and Trust also offers a nationwide reward checking account, and the rate has remained competitive for the last two years (see account review). That's hopefully a good sign that this savings account rate will remain competitive over the long-term. Also, the bank is not small with over $1.3 billion in deposits based on 9/30/09 FDIC data. So it shouldn't be overwhelmed too quickly by a large influx of deposits.

Will this savings account rate fall to average or below average a year from now? That's always the question when there's a new hot online savings account. There have been a few disappointments over the last year. The latest one is 1st Constitution Direct's Savings Account which now has a mediocre rate of 1.25% APY. However, there have been some bright spots. CNB Bank Direct is over a year old, and it's still offering a competitive savings account rate of 1.50% APY. Incredible Bank is much younger, but it's still offering 2.02% APY on its internet checking account after more than 3 months.

If you're weighing the pros and cons of opening a new savings account, refer to my post Internet Banks and Rate Chasing - Is It Worth It?. It reviews some issues to consider.

 

Update 2/16/2010: One of this blog's long-time readers was nice enough to email me the following details that he received from his conversation with the bank's CSR:

Credit Pull--They do a hard credit pull with Equifax for all new accounts, with an additional inquiry to Chex Systems. Once you have an established account, can open others with no additional hard credit pull, unless you add another (new) joint holder. Exception allowed for no additional hard credit pulls if doing additional ITF/POD accounts in your same social security tax ID number.

Account Vestings--They do offer individual, joint and POD/ITF vestings. No Trust vestings (Living Trust, etc.) are allowed. For POD/ITF vestings the POD/ITF person(s) is/are named in the account title field and appear in both the on on-line account system and the quarterly statements (electronic delivery required).

Number of Accounts Limitation--Bank allows for a maximum of 2 accounts per social security tax ID, with exception for unlimited POD/ITF accounts (since in your social security tax ID).

Account Transaction Limitations--Total maximum of 9 debit transactions per calendar quarter. This is a cumulative total per quarter, so can have 2 in Jan, 4 in Feb and 3 in Mar. All statements cut-off on quarter-end. Any debit transactions in excess of 9 cumulative per calendar quarter are assessed a $3 service charge each.

Account Transaction Dollar Amount Limitations-- No standard policy limitations per CS. They do look over higher transfers and review on a case by case basis. Remember they have your credit report from Equifax and results from Chex Systems.

Account Legacy-- This account has been offered for about 18 months, not actively advertised and the rate has been the same 2% APY since inception. The Bank does have a rate committee that meets monthly.

Bank Phone Hours: M-F 7:30 AM - 7:30 PM, EST; SAT 9AM-1PM, EST.

The On-Line Banking Department has 5 employees that would take phone calls. They know their FAQ list needs to be expanded for this information. They are also aware that the Banking Blog has this account listed and have already received a number of quality clarification calls from blog followers.

Update 2/17/2010: The reader emailed me some additional account features that he was told by the Ready Saver CSR:

On-line account statements are available for a rolling 18 months. Also they do not link (store) external accounts for transfers like most other on-line banks, so you need to enter the account information each time you want to initiate an ACH debit/credit. This could be a little risky if one is rushed and not careful in entering the information. They do not send any kind of test deposits to check the external account either. You also got the fact that they limit (no fee) to first 9 debit transaction each quarter vs. 6 per month elsewhere. They say this relates to NC banking rules--I've never heard of this before.

Rate History:

  • 01/11/11: 0.90% APY
  • 08/17/10: 1.35% APY
  • 05/17/10: 1.50% APY
  • 05/03/10: 1.75% APY
  • 02/15/10: 2.00% APY

  Tags: savings account, Southern Community Bank & Trust

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Comments
30 Comments.
Comment #1 by Ross (anonymous) posted on
Ross
Any word if you can fund the account with a credit card?

1
Comment #2 by JoeyL (anonymous) posted on
JoeyL
I would be interested to know if this is hard or soft pull...anyone?

0
Comment #3 by Anonymous posted on
Anonymous
Anyone know how fast their ACH transfers are?

1
Comment #4 by Anonymous posted on
Anonymous
Only checking and savings funding

0
Comment #5 by Anonymous posted on
Anonymous
I got wind of this via a colleague today.  I started to dig around for more information and will report back what I find out.

1
Comment #6 by Anonymous posted on
Anonymous
The accounts are funded by ACH Transfer. The ACH transfer will take 2 to 3 business days depending on when the ACH transfer is requested.  It is a hard pull.

3
Comment #7 by Anonymous posted on
Anonymous
hard pull?? that's  a deal breaker.

 

3
Comment #8 by Anonymous posted on
Anonymous
What is the requirement that you have to sign in and access your account every month?  What happens if you don't?  Since as in the case of an extended illness, travel, or computer crash?

1
Comment #9 by flagator posted on
flagator
I opened an account with $1.00 deposit. After the account was opened I did transfers from two of my online checking accounts on 2-18-10. Both transfers were debit from the checking accounts and  credit to the ReadySaver account on 2-22-10. I am going to try moving $$ from a online savings account next.

1
Comment #10 by Anonymous posted on
Anonymous
I have a ReadySaver account w/them.  I currently have another online savings account, and anytime I had a pending ACH tranfer, it lists when the transfer was requested and how much it was for.  This Readysaver account does NOT list anything that is pending, transfer wise, which I'm not crazy about.  Also, any ACH transfers I make INTO the account happen pretty quickly, but I requested an ACH transfer out of the account, into another checking account I have at another bank four days ago, and I'm still waiting for the money to be taken out and then I know it will take at least another day before it hits my checking account.  My other online savings account never took this long to transfer out funds, so no idea why this bank takes so long to make their ACH transfers to an outside bank.  This delay is very frustrating and putting me in a bind, as I've never had to wait almost a week for ACH transfers to hit my checking account before.

Has anyone else had this problem with them?

0
Comment #11 by Randy (anonymous) posted on
Randy
I work for Southern Community's marketing agency, and want to update the info about Ready Saver to say that North Carolina residents are no longer excluded from this offer and are now able to open an account at ReadySaver.com. Thanks for letting people know about the account!

1
Comment #12 by Saagar (anonymous) posted on
Saagar
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

3
Comment #13 by Anonymous posted on
Anonymous
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

1
Comment #14 by Anonymous posted on
Anonymous
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

1
Comment #15 by Saagar (anonymous) posted on
Saagar
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

1
Comment #16 by Saagar (anonymous) posted on
Saagar
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

1
Comment #17 by Anonymous posted on
Anonymous
This bank website is as stupid as it gets. When I was trying to enroll, It showed me a Image cannot be displayed with Accept DO not accept buttons below. I assumed its terms and conditions and accepted. The transfers are a nightmare. The transfers page is not secured in the same session as your login. It takes to a new page and the form has not only the incoming checking account details but also the number for the ready saver account. One mistake in a number and you are ****ed. Also, I couldnt find any page to see Scheduled Transfers or Pending transfers or anything. Very barebones website and very limited functionality for an online account. These transfer process give me chills and I am planning to close my account and go elsewhere.

1
Comment #18 by Anonymous posted on
Anonymous
Sorry about multiple comments. I didnt click on View all comments. So I thought that my comment wasnt getting posted. I could not delete the comments. So, modertor if any, please delete the extra 5 comments. Thanks

0
Comment #19 by Len (anonymous) posted on
Len
I'm a little worried about not storing the accounts linked and just allowing you to put your info in each time without any requirement to verify small deposits.  If someone got your password, they could zero your account with one large transaction and you would have little recourse.  The destination account could be someone else's, right???

1
Comment #20 by Saagar (anonymous) posted on
Saagar
I opened an account and did an initial transfer. It got reversed. You know what the best part is. Someone entering the ACH details manually made a mistake while entering the details. I was like what. So, what actually happens is, when a customer fills a form, it goes to an actual person's email or something and they manually type it into an ACH system. It is not an automated ACH transfer even at that point. The scope for errors is very high especially with huge amounts. The CR said they have an update in mid April to automate the whole process. If that doesn;t come in by April, I am closing and moving far far away from these folks.

3
Comment #21 by ichaelm (anonymous) posted on
ichaelm
I see nothing in this bank's Schedule of Fees regarding a fee for more than 9 withdrawals per quarter. I only see a fee for > 6 withdrawals per month, as every bank charges.

1
Comment #22 by ichaelm (anonymous) posted on
ichaelm
I see nothing in the Schedule of Fees regarding a fee for > 9 withdrawals per quarter, only for > 6 withdrawals per month, which of course all banks are required to charge.

1
Comment #23 by Anonymous posted on
Anonymous
CSR said today that within a week they will have system automated so you won't have to enter your external link.

1
Comment #24 by flagator posted on
flagator
With regard to slow ACH transfers from ReadySaver accounts, I requested a transfer to an external checking account on 4/12/10. The funds were credit to my external checking account and debit my ReadySaver account on 4/13/10.

3
Comment #25 by Anthony (anonymous) posted on
Anthony
It sounds to me like many people are leaving SmartPig only to find out the grass isn't always "greener"$ on the other side. What a shame....

0
Comment #26 by Chris (anonymous) posted on
Chris
Please note interest rate is now 1.75%.

Also on the ACH transfers.  First off it seems to setup a transfer from inside of the ReadySaver account you have to first "get permission", which seems to be some kind on manual request step, but I avoided that altogether.  Unlike many of these kind of accounts I was able to setup so that I can push/pull from my E*Trade Bank accounts (As in setup an external account of the ReadySaver account on E*Trade Bank).  This way I'm able to transfer to any of my E*Trade Bank accounts not just one setup at the ReadySaver account/site.  And I spend more time on the E*Trade Bank site so this a nice way to go.

Like mentioned in the other person's post I'm getting ACH transfers of 1 day.  It is started mid day at E*Trade Bank and is recorded in the early morning of the next day at the ReadySaver account.

I'm very happy with the service so far.

1
Comment #27 by Chris (anonymous) posted on
Chris
Anthony and All,

For people that have over $50,000 SmartyPig isn't really an option any more since after 5/19/2010, if you carry more then $50,000 in your account the whole $50,000 in the account will only get .5%.  SmartyPig was never really good for long term savers.  They make their money by people redeeming cash cards.  So yes they want you not to use credit cards, but what they want is for you to save some money and then spending using a cash card, and as such they are going to always gear their site to that purpose.



1
Comment #28 by Chris (anonymous) posted on
Chris
I should have said "the whole $50,000 or more in the account will only get .5%".

1
Comment #29 by Anonymous posted on
Anonymous
It has gone down to 1.5% now!!

1
Comment #30 by Anonymous posted on
Anonymous
According to a CSR I spoke with just this morning, for security reasons they now require at least a four day lead time for a bank to bank external transfer.  I said that this was very inconvenient and that I may close my account in the future.

1