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Penfed CD Penalty Change Alert

Thursday, May 26, 2011 - 8:41 PMPentagon Federal Credit Union - Details
Just noticed that PenFed Credit Union significantly increased its penalty for CD early withdrawals.  Old penalty said "CDs up to and including 5 years" was a 6 month interest penalty ; New terms state:  "CDs up to and including 4 years" is a 6 month penalty ; now, 5 year OR more CD is a full one year interest penalty.  Just something to be aware of before opening a new 5 or 7 year CD.
8
JimMartin9JimMartin911 posts since
May 26, 2011
Rep Points: 58
1. Thursday, May 26, 2011 - 9:42 PM
I thought they would do this to cover their behinds in the event of a rate increase. No surprise.
3
ShorebreakShorebreak2,368 posts since
Apr 6, 2010
Rep Points: 12,625
2. Thursday, May 26, 2011 - 10:00 PM
No surprise. 

Also, PFCU has still not corrected (?) the 01/2011 10Year CD T&Cs.  They are silent on the EWP, so I assume there is no EWP. 

Nice.
2
emoryemory15 posts since
May 26, 2011
Rep Points: 49
3. Friday, May 27, 2011 - 12:10 PM
Thanks for the alert. I have more details about this change in the last month post on increases in early withdrawal penalties. As mentioned, the new 5-year CD EWP is now up to 365 days of interest.

PenFed was late in posting the updated CD disclosure for both this change and the new 10-year CD.

The now do have these changes on their website.

Also note, this 5-year CD EWP change only affects CDs opened on or after March 15, 2011.
5
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,688
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