Survey of the Best CD Rates for January 20, 2012

Two institutions on my list of nationally available CDs actually raised rates this week, but there's not much to celebrate. One was Ally Bank which just increased its 5-year CD rate by one basis point to 1.80% APY. The other institution was Fort Knox Federal Credit Union which became infamous last year for raising the early withdrawal penalty on existing CDs. Its 3-year CD rate went up by 10 basis points to 1.90% APY which puts it just under Melrose Credit Union's 3-year CD rate. Fort Knox FCU's 4-year CD rate went up by 5 basis points to 2.20% APY which puts it on top just above Melrose Credit Union's 4-year CD rate.

Unfortunately, there were far more rate cuts. The largest cuts were at Alliant Credit Union. Its Jumbo CD rates ($25K minimum) fell by 20 basis points. Alliant had the top spot for 18-month and 2-year terms, but now KeySource Commercial Bank has the highest 18-month CD rate with a 1.25% APY and Melrose Credit Union has the highest 2-year CD rate with a 1.41% APY.

Other nationwide banks that cut rates this week include Virtual Bank, Doral Bank Direct, US Bank and Capital One.

US Bank's special 59-month CD yield fell from 2.25% to 2.15% APY. It's now tied with KeySource Commercial Bank with the highest nationally available 5-year CD rate from a bank.

Capital One Direct Banking slashed its 10-year CD APY from 2.50% to 1.85% (Costco version had a similar cut). Because of this big rate cut, I removed the CD from the list. Discover Bank continues to hold the top spot for the highest nationally available CD rate at a bank with a 2.50% APY (2.55% APY for AAA members).

Local CD Deals

There were a handful of banks and credit unions that cut their CD rates this week. On the plus side, I added one bank to the 3.00% club. It's Tecumseh Federal Bank in Nebraska which is offering a 3.03% APY for terms of 6 and 8 years. I've been excluding this bank from the list since it's in a low-populated area of Nebraska. However, the bank is currently accepting deposits from people in any part of the state as long as they can make it to the branch. Remember to always verify with the bank the rate and qualifications before planning a long drive. Small banks will often restrict new CDs to their local market area.

With the addition of Tecumseh Federal Bank, the 3.00% club now numbers four institutions. The other three are credit unions in Texas.

I added another Texas credit union this week. It's Air Force Federal Credit Union. I added its 2.75% APY 7-year CD to the over-5-year list. The 7-year CD rate went up 40 basis points this week.

Long-Term CD Break Strategy

For the short-term CDs in my lists, you might notice CDs with the note "5-year CD closed after X years". These take into account the yield after the early withdrawal penalty is applied. Since Ally Bank's 5-year CD only has a 60-day interest penalty, it's still a good deal when closed early even with the recent rate cuts.

The risks of planning for early withdrawals of long-term CDs was highlighted this week by another credit union which raised the early withdrawal penalty on existing CDs. The credit union is CEFCU which is based in Illinois. I have more details in this blog post. CEFCU is now the second credit union which has raised the early withdrawal penalty on existing CDs. Last year Fort Knox FCU did the same thing (see my blog post).

Note About the CD Survey

As I described in my rate table overview, you can use our CD rate tables to find the best rates for both nationally available CDs and local CDs. This CD survey blog posts are intended to highlight nationwide CD deals that may not be apparent in the tables. For example, I'll include the post-penalty yields of a few long-term CDs.

The CD survey blog posts are also intended to highlight the local CD deals that are available in large metro areas. There are many high CD rates, but most of these are at small banks in rural areas or at small credit unions with very narrow fields of membership. In these local CD surveys, my focus is on local CD deals that are in big cities or that are available in large areas of a state.

Yields Accurate as of January 20, 2012

Under 1-Year CD Rates

• Ally Bank - 1.20% (1.80% 5-year CD closed after 6 months, see review & risks)
• KeySource Commercial Bank - 1.15% 7-month CD special, see account review
Ally Bank - 0.91% 11-month No-Penalty CD, see account review
• AloStar Bank of Commerce - 0.85% 6-month CD

• Noteworthy Local Deals

• University of Iowa Community Credit Union - 1.45% ($250K) 1.35% ($100K) 1.25% ($1K) 10-month CD (several parts of Iowa)
• Veridian Credit Union - 1.20% ($100K) 1.00% ($1K) 7-month CD (several parts of Iowa)
• First Choice Bank - 1.05% ($50K) 1.00% ($2.5K) 288-day CD (Los Angeles & Orange County, CA)
• 1st Commonwealth Bank of Virginia - 1.00% ($100K max) 3-month CD special (Washington DC metro)
• CapitalSource Bank - 0.95% 5-month CD (California)
• American Plus Bank - 0.95% 6-month CD (Los Angeles metro)
• Industrial Credit Union - 0.90% 6-month CD (Boston metro area)

1-Year CD Rates

• Ally Bank - 1.50% (1.80% 5-year CD closed after 1 year, see review & risks)
• KeySource Commercial Bank - 1.20% 1-year CD, see account review
• Digital Credit Union - 1.17% (2.35% 5-year CD closed after 1 year, see risks)
• Pentagon Federal Credit Union - 1.16% 1-year CD
• Melrose Credit Union - 1.15% 1-year CD
• Doral Bank Direct - 1.15% 1-year CD
• CIT Bank - 1.08% ($25K min) add-on & bump-up 1-year CD

• Noteworthy Local Deals

• NavyArmy Federal Credit Union - 1.60% ($100K) 1.50% ($1K) 12-month CD (Corpus Christi, TX metro)
• General Electric Credit Union - 1.42% ($100K) 1-year CD (Cincinnati OH metro)
• University of Iowa Community Credit Union - 1.35% ($250K) 1.25% ($100K) 1.15% ($1K) 13-month CD (several parts of Iowa)
• El Paso Area Teachers FCU - 1.31% ($50K) 1.21% ($500) 1-year CD (El Paso, TX)
• First American Credit Union - 1.26% ($50K) 1-year CD (south of Phoenix, AZ)
• LOMTO Federal Credit Union - 1.20% 1-year CD (parts of New York City)
• Harris County Credit Union - 1.16% ($95K) 1-year CD (Houston)
• American Plus Bank - 1.16% 1-year CD (Los Angeles metro)
• First Choice Bank - 1.15% ($50K) 1.10% ($2.5K) 366-day CD (Los Angeles & Orange County, CA)

18-month CD Rates

• Ally Bank - 1.60% (1.80% 5-year CD closed after 18 months, see review & risks)
• Digital Credit Union - 1.56% (2.35% 5-year CD closed after 18 months, see risks)
• KeySource Commercial Bank - 1.25% 18-month CD, see account review
• Incredible Bank - 1.20% 19-month CD
• Alliant Credit Union - 1.15% ($1K min) 18-month CD

• Noteworthy Local Deals

• Cross River Bank - 1.50% 18-month CD (NJ in NYC metro area)
• El Paso Area Teachers FCU - 1.46% ($50K) 1.36% ($500) 18-month CD (El Paso, TX)
• Veridian Credit Union - 1.45% ($100K) 1.25% ($1K) 15-month CD (several parts of Iowa)
• Department of Commerce FCU - 1.45% 18-month CD (Washington DC)
• First Choice Bank - 1.30% ($50K) 1.25% ($2.5K) 541-day CD (Los Angeles & Orange County, CA)
• Montauk Credit Union - 1.25% 18-month CD (New York City)
• Focus Bank - 1.21% 19-month CD (online application for MO, AR, KY, TN & parts of IL)

2-Year CD Rates

• Digital Credit Union - 1.76% (2.35% 5-year CD closed after 2 years, see risks)
• Ally Bank - 1.65% (1.80% 5-year CD closed after 2 years, see review & risks)
• Melrose Credit Union - 1.41% 2-year CD
• Alliant Credit Union - 1.30% ($1K min) 2-year CD
• American Express Bank - 1.30% 2-year CD
• CIT Bank - 1.26% ($25K min) add-on & bump-up 2-year CD

• Noteworthy Local Deals

• NavyArmy Federal Credit Union - 2.00% ($100K) 1.85% ($1K) 2-year CD (Corpus Christi, TX metro)
• University of Iowa Community Credit Union - 1.85% ($250K) 1.75% ($100K) 1.65% ($1K) 22-month CD special (several parts of Iowa)
• Veridian Credit Union - 1.80% ($100K) 1.60% ($1K) 25-month CD (several parts of Iowa)
• Department of Commerce FCU - 1.65% 2-year CD (Washington DC)
• mBank - 1.60% 2-year CD (parts of Michigan)
• Harris County Credit Union - 1.51% ($95K) 1.21% ($2.5K) 2-year CD (Houston)
• Montauk Credit Union - 1.50% 2-year CD (New York City)
• Cross River Bank - 1.50% 2-year CD (NJ in NYC metro area)
• LOMTO Federal Credit Union - 1.50% 2-year CD (parts of New York City)
• Wings Financial Credit Union - 1.41% 2-year CD (Seattle & Minneapolis Metro areas)

3-Year CD Rates

• Digital Credit Union - 1.95% (2.35% 5-year CD closed after 3 years, see risks)
• Melrose Credit Union - 1.91% 3-year CD
• Fort Knox Federal Credit Union - 1.90% 3-year CD
• Ally Bank - 1.70% (1.80% 5-year CD closed after 3 years, see review & risks)
• CIT Bank - 1.51% ($100K) 1.49% ($1K) 3-year CD

• Noteworthy Local Deals

• NavyArmy Federal Credit Union - 3.00% 30-month CD (Corpus Christi, TX metro)
• El Paso Area Teachers FCU - 2.37% ($50K) 2.27% ($500) 36 & 30-month CD (El Paso, TX)
• Veridian Credit Union - 2.20% ($100K) 2.00% ($1K) 39-month CD (several parts of Iowa)
• University of Iowa Community Credit Union - 2.20% ($250K) 2.10% ($100K) 2.00% ($1K) 37-month CD (several parts of Iowa)
• Department of Commerce FCU - 2.05% 3-year CD (Washington DC)
• Tandem Federal Credit Union - 2.00% 3-year CD (parts of Detroit metro)
• Cross River Bank - 2.00% 3-year CD (NJ in NYC metro area)
• Institution for Savings - 2.00% 3-year CD (northeast MA)
• SPCO Credit Union - 1.97% ($50K) 1.76% ($1K) 3-year CD (Houston, TX)
• Wings Financial Credit Union - 1.86% 3-year CD (Seattle & Minneapolis Metro areas)
• Polam Credit Union - 1.85% ($25K) 3-year CD (Los Angeles)
• LOMTO Federal Credit Union - 1.85% 3-year CD (parts of New York City)
• EBSB Direct - 1.80% 3-year internet CD (New England & New York State)
• First American Credit Union - 1.76% ($50K) 3-year CD (south of Phoenix, AZ)
• mBank - 1.75% 3-year CD (parts of Michigan)
• HAPO Community Credit Union - 1.65% 3-year CD (WA State)
• City of Boston Credit Union - 1.65% ($50K) 1.55% ($500) 3-year CD (Boston metro)
• Florida Credit Union - 1.61% 3-year CD special (North Central FL)
• First Choice Bank - 1.60% ($50K) 1.55% ($2.5K) 3-year CD (Los Angeles & Orange County, CA)
• Community Bank of Tri-County - 1.50% bump-up 30-month CD (Southern Maryland)

4-Year CD Rates

• Fort Knox Federal Credit Union - 2.20% 4-year CD
• Melrose Credit Union - 2.17% 4-year CD
• Digital Credit Union - 2.10% ($25K min w/relationship) 1.85% (no relationship) 4-year CD
• Digital Credit Union - 2.05% (2.35% 5-year CD closed after 4 years, see risks)
• Andrews Federal Credit Union - 2.05% 4-year CD

• Noteworthy Local Deals

• Department of Commerce FCU - 2.50% 4-year CD (Washington DC)
• Liberty Savings Federal Credit Union - 2.40% 4-year CD (Northern NJ)
• University of Iowa Community Credit Union - 2.35% ($250K) 2.25% ($100K) 2.15% ($1K) 49-month CD (several parts of Iowa)
• SPCO Credit Union - 2.32% ($50K) 2.02% ($1K) 4-year CD (Houston, TX)
• Montauk Credit Union - 2.25% 4-year CD (New York City)
• Cross River Bank - 2.25% 4-year CD (NJ in NYC metro area)
• mBank - 2.25% 4-year CD (parts of Michigan)
• LOMTO Federal Credit Union - 2.15% 4-year CD (parts of New York City)
• Freedom Credit Union - 2.10% add-on 4-year CD (Philadelphia)
• Wings Financial Credit Union - 2.02% 4-year CD (Seattle & Minneapolis Metro areas)
• Alaska USA Federal Credit Union - 2.01% ($100K) 1.91% ($10K) 4-year CD (San Bernardino County, CA; parts of WA & AK)
• HAPO Community Credit Union - 2.00% 4-year CD (WA State)
• Peoples Alliance Credit Union - 1.98% 4-year CD (South Florida)

5-Year CD Rates

• Melrose Credit Union - 2.68% 5-year CD
• Digital Credit Union - 2.60% ($25K min w/relationship) 2.35% (no relationship) 5-year CD
• Andrews Federal Credit Union - 2.30% 5-year CD
• US Bank - 2.15% 59-month CD
• KeySource Commercial Bank - 2.15% 5-year CD, see account review

• Noteworthy Local Deals

• El Paso Area Teachers FCU - 3.03% ($50K) 2.93% ($500) 5-year CD (El Paso, TX)
• Department of Commerce FCU - 2.80% 5-year CD (Washington DC)
• Liberty Savings Federal Credit Union - 2.80% 5-year CD (Northern NJ)
• SPCO Credit Union - 2.77% ($50K) 2.48% ($1K) 5-year CD (Houston, TX)
• General Electric Credit Union - 2.63% 5-year CD (Cincinnati OH metro)
• LOMTO Federal Credit Union - 2.55% 5-year CD (parts of New York City)
• First American Credit Union - 2.52% ($50K) 5-year CD (south of Phoenix, AZ)
• Institution for Savings - 2.50% 5-year CD (northeast MA)
• Montauk Credit Union - 2.50% 5-year CD (New York City)
• First General Credit Union - 2.50% 5-year CD (Grand Rapids, MI metro)
• Polam Credit Union - 2.45% ($25K) 5-year CD (Los Angeles)
• Freedom Credit Union - 2.35% add-on 5-year CD (Philadelphia)
• Alaska USA Federal Credit Union - 2.35% ($100K) 2.25% ($10K) 5-year CD (San Bernardino County, CA; parts of WA & AK)
• Wings Financial Credit Union - 2.32% 5-year CD (Seattle & Minneapolis Metro areas)
• Washington Federal - 2.30% ($90K) 2.25% ($1K) 5-year CD (WA, AZ, ID, NV, OR, TX, UT & NM)
• Randolph-Brooks Federal Credit Union - 2.27% ($75K) 2.22% ($20K) 5-year CD (San Antonio & Austin, TX)
• Peoples Alliance Credit Union - 2.20% 5-year CD (South Florida)

Over 5-Year CD Rates

• Navy Federal Credit Union - 2.80% ($20K) 7-year CD (membership restrictions)
• Pentagon Federal Credit Union - 2.75% 7-year CD
• Apple Federal Credit Union - 2.70% 10-year CD
• Discover Bank - 2.50% 10-year CD (2.55% AAA members)
• INOVA Federal Credit Union - 2.50% 6-year CD (2.40% step-up)

• Noteworthy Local Deals

• SACU - 3.35% ($90K) 3.30% ($10K) 10-year CD (San Antonio, TX)
• Tecumseh Federal Bank - 3.03% 6-year & 8-year CD (Nebraska)
• Security Service Federal Credit Union - 2.85% ($100K) 2.70% ($500) 7-year CD (parts of Texas, lower rates in CO)
• SACU - 2.85% ($100K) 2.80% ($10K) 7-year (San Antonio, TX)
• Liberty Savings Federal Credit Union - 2.85% 6-year CD (Northern NJ)
• Department of Commerce FCU - 2.80% 7-year CD (Washington DC)
• Randolph-Brooks Federal Credit Union - 2.78% ($75K) 2.73% ($20K) 7-year CD (San Antonio & Austin, TX)
• Montauk Credit Union - 2.75% 7-year CD (New York City)
• Air Force FCU - 2.75% ($100K) 2.70% ($2.5K) 7-year CD (limited membership)
• 1st Commonwealth Bank of Virginia - 2.60% 7-year CD (DC Metro)
• Teachers Credit Union - 2.50% 71-month CD (parts of Indiana)
• Gateway Metro Federal Credit Union - 2.45% 6-year CD (St. Louis metro)
• 1st Commonwealth Bank of Virginia - 2.40% 6-year CD (DC Metro)
• Randolph-Brooks Federal Credit Union - 2.38% ($75K) 2.32% ($20K) 6-year CD (San Antonio & Austin, TX)
• Royal Bank America - 2.25% 10-year CD (Philadelphia)

Note: All rates listed above are Annual Percentage Yields (APY) which factor in compounding.'

Edit 1/21/2012: Corrected Andrews FCU name.