Update 8/26/2011: The promo rate has fallen from 1.30% to 1.01% APY
Update 8/17/2011: The promo rate has fallen from 1.50% to 1.30% APY
Capital One Bank has brought back a very nice checking account promotion for the Austin, Texas metro area. It's offering a 1.50% APY guaranteed for 12 months on its High Interest Free Checking Account. The yield is valid for balances up to $100,000. The promotional interest rate for larger balances is 1.00%.
The promotion is listed at the Capital One's High Interest Free Checking page as of May 4, 2011. To see the deal, you are required to enter your zip code. If your zip code is not in the Austin metro area, you'll see the message "We’re sorry, but the product you were searching for isn’t currently available in your area."
Many in Austin and San Antonio may remember Capital One's checking account promotion in 2007 when they were offering 5.00% with a 12-month guarantee. Unlike 2007, this new promotion is limited to just the Austin metro area.
According to the offer's printed terms "Limit one checking account related bonus/premium per consumer, per calendar year." When I called Capital One for more details, I was told that those who have an existing Capital One checking account are not eligible for this promotion.
After the promotion, don't expect the checking account rates to remain competitive. The current standard rate for the High Interest Free Checking account that was opened in 2007 is only 0.25%. Nevertheless, 12 months with a guaranteed rate of 1.50% APY for up to $100K is definitely a good deal. Unlike a reward checking account, there are no usage requirements to qualify for this rate.
The High Interest Free Checking account does have some nice features in addition to the promotional rate. These include:
- No minimum balance requirement to earn a guaranteed interest rate
- Fees assessed at any ATM within the U.S. and at some ATMs located outside the U.S. will be reimbursed within 5 business days, up to $20 per statement period
- First order of checks will be free
Capital One Simple Savings
If you don't live in the Austin metro area, but you have Capital One branches in your area, you should check Capital One's Simple Savings. This offers competitive rates for certain balances. The rates and balances vary by zip code. Some example rates as of 5/4/2011 include 1.25% APY for $2.5K+ in San Antonio, 1.15% APY for $10K+ in the DC metro area and 1.10% APY for $2.5K+ in New York City.
Capital One InterestPlus Savings Account
Another good deal that's available to all is the InterestPlus Savings Account. This is available at Capital One Direct Banking, and if you're a Costco member, you can get a little higher interest rate.
Capital One Bank Overview
Capital One Bank branches are located in Texas, Louisiana, Maryland, Washington DC, Virginia, Delaware, New Jersey, Connecticut and New York.
Capital One Bank has two FDIC charters. Capital One Bank branches are under Capital One, N.A. (FDIC Certificate # 4297). Direct Banking is under Capital One Bank (USA), N.A. (FDIC Certificate # 33954).
Capital One, N.A. is a large bank with $126.9 billion in assets. It has an overall health score at DepositAccounts.com of 4 stars (out of 5) with a Texas Ratio of 10.27% (above average) based on December 2010 data. Please refer to our financial overview of Capital One, N.A. for more details.
Thanks to the reader who mentioned this deal in the comments.