Update 4/14/2012: The special early withdrawal feature now only applies to the 3-year CD.
Northpointe Bank is offering some unique CDs with competitive rates. They're unique because there's no early withdrawal penalty for the second half of the term. For example there is no early withdrawal penalty after 18 months for a 36 month CD. The bank calls these the Special Compass CDs, and they have the following rates and terms:
- 1.80% APY 5-year CD
- 1.60% APY 4-year CD
- 1.20% APY 3-year CD
- 1.00% APY 2-year CD
These rates are listed at the bank's CD page as of 3/7/2012. I was told by the bank's CSR that although the rates are subject to change at anytime. Typically Northpointe’s rates change every two weeks, and the rates just changed last Friday. More than likely the bank will have the current rates for at least another week.
Minimum deposit is $5,000. CDs must be opened with funds not currently on deposit at Northpointe Bank.
The rates are not the best when compared against the standard CDs at other banks with similar terms. However, the special early withdrawal penalty feature makes it much more competitive. For example, a yield of 1.80% for a 30-month CD is very competitive. The special early withdrawal feature would allow the customer to make a penalty-free withdrawal from this 60-month CD anytime from 30 months to 60 months after the CD is opened. It's actually better than a 30-month CD. If rates continue to fall, you can just let the money sit until the full 60-month maturity.
This bank used to only accept deposits from Michigan, but it is now accepting deposits from any state, and it can be done by mail or fax (there's no online application). The CD can be funded by check or wire transfer. Unfortunately, they cannot guarantee the rate until they receive the funds and the application. I was told they would accept special instructions to not open the CD if rates fall while the check was in the mail.
For full information about account opening, please contact the bank.
Northpointe Bank has only one banking office. It's located in Grand Rapids, Michigan.
The bank is not in the best financial condition, but its condition has improved in the last 18 months. Its Texas Ratio has fallen from 77.34% in June 2010 to 55.65% in December 2012. The 55.65% is significantly below 100% which is considered at risk, but 55.65% is still considered below average. We give the bank a current rating of 3 stars (out of 5) based on December 2011 data. Bankrate also gives it 3 stars, but this is based on September 2011 data. Please refer to our financial overview of Northpointe Bank for more details. The bank has been a FDIC member since 1999 (FDIC Certificate # 34953).
How These CD Rates Compare
As I described above, these CDs should be compared to standard CDs with half the terms. The best nationally available CD rate for a 3-year CD (not many 30-month CDs available) is 1.86% APY at Melrose Credit Union. The best 2-year CD rate is 1.36% APY also at Melrose Credit Union. These rates are accurate as of 3/7/2012.
Searching for Top CD Rates
To search for nationwide CD rates and CD rates in your state, please refer to the best CD rates section of DepositAccounts.com.