We have seen many rate leaders cut their CD rates this month. The latest one is Melrose Credit Union which recently reduced its long-term CD rates by 10 basis points. The 1-year and 2-year CD rates did not change. This is only the second time this year that Melrose Credit Union has cut its CD rates. The last one on February 1st was much worse when the 5-year CD yield fell 41 basis points. Below is a summary of the new rates as listed at Melrose Credit Union's share rates page as of 4/27/2012. I also included the old rates for reference:
- 2.17% APY 5-year CD (was 2.27%)
- 1.96% APY 4-year CD (was 2.07%)
- 1.76% APY 3-year CD (was 1.86%)
- 1.36% APY 2-year CD (no change)
- 1.10% APY 1-year CD (no change)
These rate cuts show that we may soon lose 2.00% CD rates just like we lost 3.00% CD rates last year.
Even with these rate cuts, these rates are still competitive in today's awful interest rate environment.
One thing to keep in mind before applying for one of these CDs is that Melrose Credit Union has a harsh and confusing early withdrawal penalty. Here's the early withdrawal penalty for CD terms over 1-year as listed in the disclosure (Make sure to request the latest disclosure from Melrose before you open a CD.)
18-60 Months term: Forfeiture of the first 180 days Dividend and a Reduction to the Share Savings Rate at the time of purchase.
Not only do you have to pay 180 days worth of interest on the principal, but you will be required to recalculate all of the interest earned to date at the share savings rate (which is currently 0.50%), and give back the difference.
Those with very large balances can earn an extra 25 basis points on the above CD rates. The required minimum balance is $1 million. Please refer to Melrose Jumbo CD page for more details. Note, with beneficiaries and joint accounts, it's possible to federally insure $1 million in deposits. Please refer to my post Maximizing Your FDIC Coverage with Beneficiaries.
Melrose Credit Union Membership
Anyone can join the credit union. According to Melrose's membership page:
Since Melrose Credit Union has an open New York State charter there are no geographic or group affiliation field of membership restrictions. So, regardless of where you live or how you earn a living, you may qualify for membership.
Even though Melrose makes it easy to qualify, they don't make it easy to apply. Several readers have commented about problems they had in the application. Please refer to my November Melrose Credit Union CD review for more of these details.
Melrose Credit Union has one office located in Briarwood, New York which is in Queens.
Melrose Credit Union's Financials
The credit union continues to have strong financials. Its overall health score at DepositAccounts.com is still 5 stars (out of 5) with a Texas Ratio 0.56% (excellent) based on December 2011 data. Please refer to our financial overview of Melrose Credit Union for more details. The credit union is federally insured by the NCUA (Charter # 62005).
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: