Dedicated to Deposits: Deals, Data, and Discussion

Very Competitive 2-Year CD Rate at Broadway Federal Bank - Available Nationwide

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Broadway Federal Bank

Broadway Federal Bank has increased the rate of its 2-year online CD from 2.02% to 2.53% APY. Minimum deposit is $1,000. This is listed at Broadway Federal's home page and on its Open-An-Account page as of 5/01/2010.

It's nice to see a sizable rate increase like this. For a 2-year term, a 2.53% APY is very competitive. It's the highest rate at the DepositAccounts.com 2-year CD rate table which includes Alliant Credit Union's 2.25% APY for a 2-year term for a $25K minimum. The best nationwide 24-month CD rate currently listed at Bankrate is 2.05% APY from TriState Capital Direct and this requires a $100K deposit.

On the first page of the online application, several important details are listed. Here are excerpts:

  • To apply for an account online, you must be a U.S. Citizen or resident alien, have a U.S. address and be 18 years or older.
  • We will need to verify your identification and require that you send a copy of your driver’s license or ID.
  • If you are a new customer you will be asked to mail a check along with the new account application or you can identify an account at another Bank that you would like the funds withdrawn. In order to complete this process you will need the information at the bottom of one of your current checks.
  • Accounts are not opened until the Bank receives the funds. The Bank must receive funds within thirty days or your application for an account will be cancelled. Accounts are opened Monday through Friday only. Your account will receive the rate and annual percentage yield in effect on the date the account is opened. Certificate of Deposits will receive the rate and annual percentage yield in effect on the date the application is submitted.

Past Broadway Federal Reviews

I last reviewed Broadway Federal's online CDs in this July 2009 post when the yield was 3.05%. At that time funding a CD with an ACH transfer wasn't operational. Hopefully, that has been fixed. Please leave a comment if you have given it a try. Below are comments from readers who opened the online CD last July:

It appears that their web based process is new and only minimally automated, there are slight wrinkles, which I am sure will get ironed out. That said, I found the communications from them friendly, professional and accurate. Note that their online branch address is in Inglewood, so wait until they send you instructions by email with the address before mailing your check to them. The application process progressed only on business days. I was asked to mail in a copy of my social security card and drivers license.
I applied 7/12. On 7/13 I received an E-Mail confirming the application and indicating that it was being processed. On 7/15 I received a 2nd E-Mail requesting that I mail a check and copy of my drivers license (ACH still not available). I mailed the check, etal on 7/16 and am waiting for confirmation that they have received the check and opened the account. They did indicate that the 3.00/3.05% APY rate would be good for 30 days.

Other Certificate of Deposit Rates

In addition to this 2-year CD, Broadway Federal has some other competitive CD rates. However, these don't seem to be online CDs, so a branch visit may be required. The highest rate is a 3.56% APY 72-month CD. Other ones include a 3.05% APY 60-month CD and a 2.79% APY 36-month CD. These are listed at the bottom of the bank's current rates page as of 5/01/2010.

Bank Overview

Branches are located in Los Angeles and Inglewood, California.

The bank's rating for safety and soundness has gone down at Bankrate.com. It now has 2 stars (below peer group) based on 12/31/09 data (Bankrate finally updated ratings to 12/31/09 data). The rating had been 4 stars when it was based on 12/31/08 data. The bank continues to have a 4-star rating (excellent) at BauerFinancial (based on 12/31/09 data). At DepositAccounts.com we have a health score for Broadway Federal of 3 out of 5 based on 12/31/09 data. The rating was hurt most by the Texas ratio trend and by its capitalization.

Thanks to the reader ekat who mentioned this rate increase in the Open Discussions Thread.


  Tags: California, Broadway Federal Bank, CD rates

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Comments
2 Comments.
Comment #1 by SJH (anonymous) posted on
SJH
 Opened a CD online yesterday with Broadway Federal.  Today, I rec'd this email.  This concerns me because the exact same thing happened wlith Bank of America a few years back, and after sending a check, they "fixed" their problem with the ACH, and then attempted to w/d the same amount from my checking account. This resulted in a real mess, that took over 2 weeks to straighten out.  I will be contacting them before I send a check. Dear Online Banking Customer, We are continuing to process your application. However due to some current technical issues with our system the  ACH transfer method you selected to open your online account with is currently not available.   We apologize for any inconvenience this may cause.   In order to complete the opening account process we are requesting you to provide us with the following:  Mail a check and/or money order payable to yourself endorsed "For Deposit Only"  A copy of your current drivers license Please forward all requested information to the address listed at the bottom of this email. 



 

 

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Comment #2 by ekat posted on
ekat
To SJH:  I will be interested to see how it goes for you, since I have had really good customer service from them. As a community bank, they always seem to try being very one-on-one helpful both on the phone and in person. (For ex, I mis-timed transferring funds to cover a check, but their policy is to call  before returning it, which saved me a lot of hassle.) Definitely more efficient in person than email, so telephoning is a good idea. LaTorya Mitchell at the Inglewood branch handles the online accounts (maybe flag her on what happened to you, so she can safeguard that occuring again). When they have a big online promotion, then they might get inundated, which can slow things down. But my experiences are that they will ultimately take care of you. I found it more helpful to think in terms of working with them more as a local bank than as an online institution.

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