This is another case of a bank raising long-term CD rates. Dollar Bank raised its 10-year, 6-year and 5-year CD and IRA CD rates this week. The most competitive ones are now its 6-year and 10-year CDs. The 6-year CD has a 2.00% APY and the 10-year CD has a 2.75% APY. The 5-year CD is not quite as competitive with a 1.50% APY. Slightly higher rates are available with CD ladder and relationship options. These rates are listed in Dollar Bank’s rates page as of 8/23/2013.
Dollar Bank’s early withdrawal penalty is unique. It becomes larger if interest rates rise. Below is an excerpt from the CD account information schedule:
A penalty will be charged if you withdraw principal before the maturity date. The penalty for early withdrawal from this certificate will equal the years remaining until maturity (including partial years) multiplied by the principal being withdrawn, multiplied by the difference between the contract rate on the certificate being withdrawn and the rate currently offered on certificates with terms closest to the years remaining until maturity on the certificate being withdrawn. The penalty, however, shall not be less than three month's simple interest for certificates having terms of 12 months or less and shall not be less than six month's simple interest for terms greater than 12 months with interest calculated at the contract rate.
Dollar Bank also has a good savings account deal for small balances. It’s called FreeMONEY Savings, and it currently pays 1.20% APY on balances up to $20K. It does require a checking account. Please see my FreeMONEY Savings review for more details.
I confirmed by phone yesterday that Dollar Bank only accepts new customers who live in their market area. They define their market area as the region that’s within 100 miles of one of their branches which are located in the Pittsburgh and Cleveland metro areas. The 100-mile limit applies only within the state where the branch is located. For example, if you live in Ohio and live 50 miles from a Pittsburgh branch and more the 100 miles from a Cleveland branch, you may still not be eligible.
If are eligible to be a new customer, you can apply for CDs online, by phone or at a branch.
Dollar Bank Overview
It's a sizable community bank with $6.7 billion in assets. The bank continues to have solid financial ratings. Its overall health score at DepositAccounts.com is 5 stars (out of 5) with a Texas Ratio of 5.98% (excellent) based on March 2013 data. Please refer to our financial overview of Dollar Bank for more details. The bank has been a FDIC member since 1984 (FDIC Certificate # 32245).
Searching for the Best CD Rates
To search for the best nationwide CD rates and the best CD rates in your state, please refer to the CD rates section of DepositAccounts.com.