It has become very difficult finding CD rates over 2.00% in this awful interest rate environment. That's even the case for long-term CDs with terms over 5 years. In the last few months, we have seen several credit unions that have cut their long-term CD yields to 2.00% or lower. One credit union that hasn't yet cut rates like this is Air Force Federal Credit Union. It's still offering a 7-year CD and IRA CD with a 2.25% APY for a $100,000 minimum deposit and a 2.20% APY for a $2,500 minimum deposit. The shorter-term CD rates are not quite as competitive. These rates are listed in the credit union's rates page as of 9/26/2012.
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the date of the withdrawal to the maturity date applying the contracted rate on the certificate based to the amount withdrawn over and above any dividends credited to the certificate to date of withdrawal.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.
It appears that Air Force FCU has expanded its field of membership. It used to be primarily limited to those connected to the military in certain states. However, there's now a foundation that anyone can join to become eligible for credit union membership. If you click on the "Join Us" link on the top menu of Air Force FCU's website, it will take you to an online application. Click on the "become a member" button, and you'll see all of the options for membership eligibility. I noticed a new option:
16. Members of The Lackland Gateway Heritage Foundation Inc.
Below the membership eligibility option list, you can select "Not a member of The Lackland Gateway Heritage Foundation Inc, but I would like to join." If you click on the informational link for this foundation, a page is shown describing this foundation. On this page it states the following two important facts:
* Membership in the Foundation is open to all people regardless of any military service affiliation.
* Membership dues in the amount of $25 are required to join the Foundation.
You can be immediately eligible to join Air Force FCU if you fall under the other options in the membership eligibility list. The first option is:
Military and Civilian personnel regularly employed by the Department of Defense who are assigned to, stationed at, or work at any United States Government installation, facility, or unit, afloat or ashore in Texas, Oklahoma, Arkansas, Louisiana, or Mississippi.
Credit union membership requires a minimum balance of $5 in the regular savings account.
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 at the bottom of this 2010 blog post.
Other Deposit Products and Deals
The credit union is currently having a refer-a-friend promotion in which both you and the person referred can receive a $50 bonus. The new member must maintain a savings and checking account for one year. Please refer to the Air Force FCU promo page for more details.
The credit union offers a free checking account with no monthly service fees. The credit union is part of the CO-OP Network. This allows members to use any of the CO-OP Network's 28,000 ATMs world-wide with no surcharge or transaction fee.
Credit Union Overview
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 4.83% (excellent) based on March 2012 data. Please refer to our financial overview of Air Force FCU for more details. The credit union is federally insured by the NCUA (Charter # 8169).
How These CD Rates Compare
Based on this expanded field of membership, Air Force FCU can be included with institutions that offer CDs that are nationally available. For this group, this 2.25% APY 7-year CD is a rate leader for all terms. The next best is 2.10% APY for a 10-year CD at Discover Bank. The next best yield for a 7-year CD is 2.02% APY at Pentagon Federal Credit Union.
These rates are accurate as of 9/26/2012.
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: