Air Force Federal Credit Union did something that's not common these days. It made some large rate increases on its share certificates. Its long-term CDs and IRA CDs are now competitive. The best ones include a 2.75% APY 7-year CD, 2.20% APY 5-year CD and a 1.60% APY 3-year CD. Minimum deposit is $100,000. For the 7-year and 5-year CDs, rates are 5 basis points lower for a $2,500 minimum deposit. These rates are listed in the credit union's rates page as of 1/19/2012.
The credit union's early withdrawal penalty is a little convoluted:
The early withdrawal penalty will be equal to one half of the dividends that would accrue from the date of the withdrawal to the maturity date applying the contracted rate on the certificate based to the amount withdrawn over and above any dividends credited to the certificate to date of withdrawal.
This penalty is listed at the bottom of the CD rate tables. So if you make an early withdrawal within one year of maturity, it appears you would lose six months of interest (dividends). However, if it's four years before maturity, you'll lose two years of interest.
The credit used to be open to all US Armed Forces. However, it's now limited to those connected to the military who are working in Texas, Oklahoma, Arkansas, Louisiana, or Mississippi. If you click on the credit union's "join us" link and then click on "become a member" link, you can see the full details of the credit union's field of membership.
There was an interesting event at this credit union in 2010 regarding its field of membership. The NCUA cited Air Force FCU for improper membership. I reviewed NCUA's letter of understanding in this 2010 blog post.
Air Force FCU branches are located in San Antonio and Del Rio, Texas. The credit union is also part of the CU Service Centers which allows you to make several banking transactions at shared branch offices around the nation.
The credit union has an overall health score at DepositAccounts.com of 5 stars (out of 5) with a Texas Ratio of 4.12% (excellent) based on September 2011 data. Please refer to our financial overview of Air Force Federal Credit Union for more details. The credit union is federally insured by the NCUA (Charter # 8169).
How These CD Rates Compare
The best 7-year CD rate that's nationally available is 2.75% APY at Pentagon Federal Credit Union. Its 5-year CD rate is also competitive with a 2.25% APY. Both of these CDs have an early withdrawal penalty of up to one year of interest. The highest 5-year CD rate is 2.68% APY at Melrose Credit Union. These rate are accurate as of 1/19/2012.
Searching for the Best CD and IRA CD Rates
To search for the best nationwide rates and the best rates in your state, please refer to the following sections of DepositAccounts.com: