TrustBank is offering two competitive regular CDs and a competitive 4-year add-on CD. The two regular CD rates are 2.40% APY for a 3-year term and a 3.00% APY for a 5-year term. Minimum deposit is $500. An even better deal is the bank's add-on CD called the DreamBuilder CD. The 4-year DreamBuilder CD has a 2.65% APY. Minimum deposit is $50. These rates are listed in the bank's CD rate table as of 7/26/2010.
The DreamBuilder CD requires that you have monthly deposits into this account. The bank's DreamBuilder CD page didn't have many details, so I emailed the bank last week. Here is the reply I received:
There is no maximum initial deposit limit for the DreamBuilder CD, however when opening online there are different funding limits depending on what method you use to fund the account. For example, funding is limited to $1000 if using a credit card. You can change the amount of the monthly deposit once the CD is open.
Since the monthly deposit amounts can be changed after it's opened, this CD has the benefits of an add-on CD in that the initial deposit and monthly deposits can be set to a small amount at the beginning, but later the monthly deposits can be increased if the interest rate environment doesn't improve. This can be used like an insurance policy against a low interest rate environment that lasts for a long time.
The bank has an online application via andera.com that allows ACH funding. Last week I asked the bank if they allow out-of-state applications. Here was their reply:
We accept customers from anywhere in the U.S. providing they pass our identity verification procedures.
If you prefer a branch visit, the bank has branches in Illinois and in Tempe, Arizona.
TrustBank's ratings for safety and soundness are fair: 3 stars (adequate) at BauerFinancial, 3 stars (performing) at Bankrate.com and an overall health score of 4 out of 5 at DepositAccounts.com (see our financial overview for TrustBank). These ratings are based on 3/31/10 financial data. The bank has been a FDIC member since 1934 (FDIC Certificate # 14662).
Searching for the Best CD Rates
Unfortunately, high rates on add-on CDs are very hard to find these days. Some banks and credit unions used to offer very competitive rates on their add-on CDs, but rates have gone down considerably, even more than regular CDs. I still list a few of these add-on CDs in my weekly summary. Most have 1-year terms which isn't really long enough to be useful as an insurance policy.
To search for the best nationwide CD rates and the best CD rates in your state, please refer to the CD rates section of DepositAccounts.com.