Dedicated to Deposits: Deals, Data, and Discussion

Survey of the Best CD Rates for February 24, 2012

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If you have a CD ladder and your 5-year CDs are maturing, you are probably very disappointed. It's hard to find banks offering 2.00% APY on 5-year CDs. Last week I had two nationally available banks on my list with 5-year CD rates of at least 2.00%. One of those two State Bank of India cut its 5-year CD yield from 2.02% to 1.96% this week. So now only US Bank's special 59-month CD has a yield of 2.00%.

You can find higher CD rates thanks to credit unions. The top three all-access credit unions on my 5-year CD list are Andrews FCU with a 2.30% APY, Melrose Credit Union with a 2.27% APY and PenFed with a 2.25% APY. Please note that credit unions often make rate changes at the start of each month. With March starting next week, we may see some rate cuts at these credit unions. Fortunately, we have an extra day in February thanks to leap year.

I'm still seeing a few CD specials at banks and credit unions. Sometimes these can be really good deals. Unfortunately, they often have checking relationship requirements. One example that reader me1004 found is Farmers State Bank in Indiana. It's offering a special 25-month CD with a 1.81% APY. A checking account with either direct deposit or automatic payment is required. The bank is currently accepting applications by mail. However, as you might expect from a small bank, they don't make it easy. They're requiring a notarized copy of the driver's license. Small banks will often accept deposits by mail from any state. However, it's common to see them restrict deposits to their local market areas if they see too much demand. Update 2/27/2012: I just received a email reply from Farmers State Bank saying that they are no longer opening accounts by mail for customers outside of our 5 county area and contiguous surrounding areas.

Local CD Deals

One of the credit union rate leaders actually raised its CD rates this week. San Antonio Credit Union (SACU) raised its 10-year CD yield from 3.35% to 3.55%. Its 7-year CD yield increased from 2.85% to 3.05%. These require a $90K minimum deposit. Rates are about 5 basis points lower for a $10K minimum.

I added two institutions to my 1-year CD list this week. Both are offering special 1-year CDs with very competitive rates. Lyons National Bank in New York is offering a special 2.00% APY 1-year CD. Similar to Farmers State Bank above, this requires a checking account with direct deposit. The other institution is City County Credit Union in Florida. It's offering a 1-year IRA CD with a 1.51% APY. Unfortunately, this special rate only applies to the IRA CD.

With the Fed's commitment to keep rates near zero until at least late 2014, banks and credit unions may be more willing to offer short-term CD deals than long-term CD deals. When those CDs mature, I'm sure the institutions are hoping the customers will let their CD rates roll over into new CDs with regular rates.

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 recently highlighted 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 February 24, 2012

Under 1-Year CD Rates

  • Noteworthy Local Deals

1-Year CD Rates

  • Noteworthy Local Deals

18-month CD Rates

  • Noteworthy Local Deals

2-Year CD Rates

  • Noteworthy Local Deals

3-Year CD Rates

  • Noteworthy Local Deals

4-Year CD Rates

  • Noteworthy Local Deals

5-Year CD Rates

  • Noteworthy Local Deals

Over 5-Year CD Rates

  • Noteworthy Local Deals

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

  Tags: CD rates

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Comments
5 comments.
Comment #1 by Anonymous posted on
Anonymous
Justice FCU has a 2.35% 5 year Jumbo($100K). Easy membership with membership in National Native American Law Enforcement Assoc. 

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Comment #2 by KenBDG posted on
KenBDG
Thanks for the note on Justice FCU. I have included it in the past as an "easy membership" credit union, but I've been hesitant to include it now due to readers' reviews.

3
Comment #3 by lof posted on
lof
Simple terms, never use Justice FCU, LA branch will do everything possible to keep you from opening an account.  Experience when I opened a (2yr @ 6.35%) about 5 years ago.

1
Comment #4 by Anonymous posted on
Anonymous
Chase has a 2% 10 year CD in CA.

2