Dedicated to Deposits: Deals, Data, and Discussion
Featured Savings Rates
Featured Accounts
Back to Rate Changes, Deals and Promotions

Important Note For Those Who Reserved CDs In The Penfed Watch It Grow CD Promotion

Thursday, December 30, 2010 - 4:38 PMPentagon Federal Credit Union - Details
Update 1/6/11: This is just a reminder that those who did not reserve these 10-year CDs in September, are not eligible for these 10-year CDs. PenFed is not currently offering a promotion on new money 10-year certificates to any member.

Update 1/1/11: It looks like all CDs that were reserved have taken effect. A reader provided the following comment:
For all those worried about PenFed's 10yr CD promo, fear not. I had reserved through the glitch starting 1 Jan 2011. It is now posted as one of my CDs. Note: I had no CD maturing in Sep or Oct or whatever those stupid promo rules stipulated. Was all new money.

Update 12/31/10: Although I have not heard back from my PenFed contact, readers have been in contact with PenFed customer service supervisors who have informed them that PenFed will start funding all the reservations beginning on Jan 1st.

A reader in the blog post The 10 Best Bank Deals for Savers in 2010 provided the following comment concerning PenFed's Watch It Grow CD promotion. I forwarded it to my PenFed contact for confirmation and clarification.This contradicts what I was told in September. I'll update the thread when I hear more.
I was just on phone with PedFed. And the representative cleared with their upper management on the reseved CD funding. They state whatever CD amount you reserved can not be more than your previous CD with PedFed, even if the online reservation let you do it and even if it still shows up in your reserved CD online.There are 3 situations:

1. your reserved CD amount equals or less than your previous qualified CD with PenFed. Then you are OK.

2. your reserved CD amount is more than your previous qualified CD with PenFed: When you send the money in, they are only going to put the max of previous CD amount, and leave the rest in the saving/checking account that you have. You have to request it yourself to get the money return it to you, otherwise it stays in the saving/checking account

3. You reserved CD, but didn't have qualified CD with PedFed before. Your money will stay in the saving/checking account. You have to request it yourself to get the money return it to you.


This is very different from what they said before that they are going to honor the CDs because of the online system mistake. Just want everyone to know.
9
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,702
1. Thursday, December 30, 2010 - 6:22 PM
I just spoke to a supervisor who I have been talking to for the last few months, and she assured me if you currently have the reservations they will be honored. The other poster was either told the wrong info or does not currently have a pending reservation.
8
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
2. Friday, December 31, 2010 - 2:57 AM
I was the one who posted this first. I was on the phone with a CSR on 12/30 lunch time for 1 hour. I have 2 pending reservations still show up in my online acccount right now. The CSR went to check with her upper management twice. I told her that I already mailed the money, and she said it doesn't matter, they will open the same amount as my previous CD, and keep the rest of the money in my saving account. I told her that I would loose interest on those money, she stay nice but just said there is nothing she can do.

I told them that many customers would have the same situation, and I ask her why PenFed didn't inform the customers if they decided not to honor the reservation. She said she doesn't know why the credit union didn't do that. And she would let the management know my feedback.
2
outtempsterouttempster7 posts since
Jun 16, 2010
Rep Points: 160
3. Friday, December 31, 2010 - 4:27 AM
The person you talked to is wrong. If you have pending reservations and have money in your account at Penfed, the certificates will be funded on the scheduled day in Jan.  Relax - you don't need to call them, because you may end up talking to an uninformed CSR who doesn't know what they are talking about. Trust me, there is no way they can rescind this deal for anyone with reservations and available funds, particularly after all their reassurances from numerous management-level people.
4
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
4. Friday, December 31, 2010 - 9:40 PM
Ken, I do hope you hear back from your PFCU contact soon...

As mentioned above, a lot of us have other banking arrangements and would incur various losses if we exit those and start to or actually move the reserved CD funds to PFCU, only to potentially discover they won't honor the reserved certificates.

I was talking to them a few weeks ago, and since time had passed and interest rates had kept going down, asked my rep about the status of the promotion and the CDs I had on reserve, and still today show as being reserved. And at that time, she assured me everything was fine and still on track.

I'm one of those PFCU members who was able to take advantage of their glitch, even though I have other CDs with them that didn't fall into the original parameters of their promotion.

Also, I hope anyone who has an early funding date, since Jan. 1 has now arrived, and fits into the supposed exception areas issued above where the CDs might not be opened does report here on what happens with their CD openings, as to whether they go thru or not...

One way or the other, people in the reservation program are going to start finding out now...
3
thaiguyinlathaiguyinla14 posts since
Dec 27, 2010
Rep Points: 33
5. Saturday, January 1, 2011 - 2:21 AM
Pedfed account posted! CD is now Open.I had reserve ,matured account,no new money,roll over only.
3
plowkingplowking20 posts since
Aug 19, 2010
Rep Points: 57
6. Saturday, January 1, 2011 - 3:25 AM
Plowking, from your shorthand description, it sounds like your status was not one of those categories in potential doubt. It's the other kinds of reservations as described in the original post here where a question of doubt has been raised.
2
thaiguyinlathaiguyinla14 posts since
Dec 27, 2010
Rep Points: 33
7. Saturday, January 1, 2011 - 3:41 AM
Thaiguyinla, all pending reservations were opened. You can relax, although there was never a doubt that they would honor all reservations. Unfortunately, we had one poster here who needlessly caused alot of people a great deal of concern. I think Ken made a mistake giving that guy a thread for his misinformation.
4
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
8. Saturday, January 1, 2011 - 3:55 AM
One last thing: I have noticed that a number of people have been posting unfounded, alarmist nonsense about banks and credit unions not honoring CD's prepayment penalties or closing CD's without cause. There has been a couple of cases of banks doing this, but this is hardly proof that this is a real concern for 99.999999% of banks and credit unions out there. People need to calm down and think before posting this stuff. You can always take a couple of isolated cases and say it is the end of the world without any real facts to back it up. Ken needs to watch this and tone it down, because I believe it may be causing too many people unnecessary agitation and possibly influencing their investment decisions.
6
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
9. Saturday, January 1, 2011 - 5:00 AM
Lou, thanks for your posts... I wasn't alarmed because the info hadn't been confirmed in any way... But I was concerned to see the doubt raised, as doubtless were many others here.

About your prior post, you said "all pending reservations were opened."  Does that mean you had CDs yourself successfully opened today and also were in one or more of the potential doubt categories raised above? Or if not, what's the source of  your information on that... I'd certainly like to hear that the doubt has been erased.
3
thaiguyinlathaiguyinla14 posts since
Dec 27, 2010
Rep Points: 33
10. Saturday, January 1, 2011 - 5:10 AM
Interesting... this reminded me to check PFCU's web site to see if they had as yet posted anything re their regular 10-year CDs that supposedly are coming (as opposed to the separate reserved CDs rates).

As of today (1/1), they're still showing only the 7 year CDs as their longest, and the rate table for their CDs references the rates being current as of 1/1/2011...
3
thaiguyinlathaiguyinla14 posts since
Dec 27, 2010
Rep Points: 33
11. Saturday, January 1, 2011 - 5:43 AM
Yes, I had those reservations and they were opened today. I was told by a Penfed supervisor that the 10 year certificates for the general public would not be introduced now, but might be later. The bottom line is that they did exactly what they said they would do.
4
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
12. Saturday, January 1, 2011 - 8:15 AM
Great news above at the top of the thread with Ken passing along the successful CD result of a "glitcher."

A lot of folks breathing easier tonight... :-)
2
thaiguyinlathaiguyinla14 posts since
Dec 27, 2010
Rep Points: 33
13. Wednesday, January 5, 2011 - 9:53 AM
I had reserved two separate CDs, both worth much more than maturing CDs and both of them are now honored for a 10-year CDs for 5%.
4
lavender74lavender741 posts since
Jan 5, 2011
Rep Points: 4
14. Saturday, January 8, 2011 - 2:44 AM
I have received the 10 year certificates in the mail and noticed that they have not changed the language on the reverse side regarding the early withdrawal penalty. It only goes up to 7 years. They obviously did not update their terms and conditions to reflect the new 10 year term. I wonder if they made a mistake or deliberatively did not amend the language to include this new certificate.
3
loulou521 posts since
Aug 3, 2010
Rep Points: 3,239
15. Saturday, January 8, 2011 - 9:02 AM
Same here... I'm a PFCU pre-existing member with "glitcher" CD reservations... They just funded a bunch of new 10 year CDs for me from among my reservations.... no fuss, no muss... And all of the new CDs showed up correctly in my online banking profile by the time I checked again.

One note, the CSR I spoke with said they've been having some problems with the promotion 10 year CDs, where they actually create and fund the 10 year CDs for customers, but then those new CDs show up wrongly in online banking as 7 year ones. The CSR who assisted me said I should watch out for that, but it didn't happen in my case. Everything was correct from the get-go...

But it does sound like they're not quite up to speed yet on all the paperwork and processes for the 10 year CDs, since they're not yet offering those to the general public as yet.
3
moneysavermoneysaver29 posts since
Jan 8, 2011
Rep Points: 236
Reply