North Dakota Deposit Account Rates and Deals

Update 7/24/09: The RateBuilder CD rate has fallen to 2.21% APY.

Choice Financial continues to offer a very competitive 13-month CD as part of its RateBuilder Accounts. When I first posted on Choice Financial in May, they were offering hot deals on both the savings account and this CD. In less than a week after the post, they made substantial rate cuts. The CD rate fell from 3.01% to 2.51% APY. As of 7/13/09, the CD rate is still 2.51% APY which is now a very competitive rate for a 13-month maturity. In addition, it has a limited add-on feature which allows you to make additional deposits to the CD up to the original deposit amount. Below is a summary of the CD features based on their disclosure (pdf) and based on what I was told by the CSR in May:

• 13-month term
• $5,000 minimum deposit
• Interest will be compounded and credited annually
• Early withdrawal penalty equals 6 months of interest on the amount withdrawan
• Grace period at maturity of 10 calendar days
• Add-on feature: You will be able to make additional deposits to the CD up to the original deposit amount without extending the term of the CD
• CD starts earning interest on the business day that they receive the initial deposit (CSR)
• CD rate that you will receive is the rate as of the date that they receive the application (CSR)
• When the CD matures, you may elect to have those funds withdrawn by a mailed check, ACH transfer or wire transfer (CSR)
• You can close the CD over the phone. They'll use security questions to verify your identity (CSR)

For more details of this CD and the savings account and to read comments of those who applied, please refer to my May account review.

Choice Financial is a small bank with 11 branches in North Dakota. You can review the details about their financials at this FDIC page. They have some solid ratings for safety and soundness: 4 stars (excellent) at BauerFinancial and 4 stars (sound) at Bankrate.com. Both ratings are based on 3/31/09 financial data. The bank has been a FDIC member since 1934 (FDIC Certificate # 9423).

Other High Certificate of Deposit Rates

• My weekly list of hot nationwide and local CD deals
• My weekly list of all nationwide CD deals
• Index of state CD and bank deals

Update 7/24/09: Rates have dropped. Rate Builder Savings: 2.26% APY 30-day intro, 1.26% APY $5K-$25K, 1.51% APY $25K-$100K, 1.76% APY $100K+. Rate Builder 13-mo CD: 2.21% APY.

Update 5/12/09: Rates have dropped. Rate Builder Savings: 2.76% APY 30-day intro, 1.76% APY $5K-$25K, 2.01% APY $25K-$100K, 2.26% APY $100K+. Rate Builder 13-mo CD: 2.51% APY. Rates are from disclosure.

Choice Financial has two attractive deposit account deals: a savings account with a rate of up to 3.26% APY and a 13-month CD with a rate of 3.01% APY. The bank calls these their RateBuilder accounts. The savings account and CD are available nationwide. There's also a high-yield checking account for those in Minnesota, Montana and the Dakotas.

The savings account has a 30-day intro rate of 3.76% APY. After the intro period, the following tiered interest rates apply:

• 2.76% APY $5K to $25K
• 3.01% APY $25K to $100K
• 3.26% APY $100K and over

The above rates are listed at the RateBuilder Page as of 5/08/09. Note, the disclosure lists the rates for the bottom two tiers as interest rates rather than APY.

One downside to this account is that interest is only credited quarterly, and if the account is closed before the interest is paid, you'll lose the accrued interest. Some other features mentioned on the website and the disclosure (pdf) include:

• Minimum opening deposit of $5,000
• $2/month fee if balance falls below $5K on any day of the month
• Interest credited and compounded quarterly
• $50 closing fee if closed within first 90 days
• If account is closed before the interest is paid, you'll lose the accrued interest
• Typical limit of 6 withdrawals per month

RateBuilder Certificate of Deposit

There's also a good deal on the RateBuilder CD. As of 5/08/09, the rate is 3.01% APY for a 13-month term. Minimum deposit is $5,000. Some additional details mentioned in the disclosure (pdf) includes:

• 13-month term
• $5,000 minimum deposit
• Interest will be compounded and credited annually
• Early withdrawal penalty equals 6 months of interest on the amount withdrawn
• Grace period at maturity of 10 calendar days
• Add-on feature: You will be able to make additional deposits to the CD up to the original deposit amount without extending the term of the CD

Additional Details from the Customer Service Representative

For some additional details about the savings and CD, I called the bank's customer service number at 1-877-380-3623. At first, the voice message informed me that they were busy with other customers and that I should leave a message. Instead of leaving a message, I called back a little later and was quickly connected to a CSR. According to the CSR, they rolled out these RateBuilder accounts about 4 weeks ago. She said the posted rates are accurate. Some additional things I was told by the CSR include:

• No hard credit inquiry. They just use ChexSystem
• ACH service provided to allow electronic funding of savings account and CD. You can also mail a check
• Savings account has an ACH transfer service. Transfers are free, and there are no size limitations on transfers (CSR didn't appear too knowledgeable about this)
• CD rate locks at the time that the application is submitted

There were two interesting features mentioned in the disclosure that I tried to confirm with the CSR:

Savings account bonus: As described in the disclosure: Electronic gift certificate issued after receiving opening deposit valued at $10. Electronic account anniversary gift certificate issued one year from account opening date valued at $25 if your account has an average daily balance $500 on the account anniversary date. The CSR confirmed this. She said that the gift cerificate is for some online store.

Add-On Deposits in the CD: As descrbied in the disclosure: After the account is opened, you may make an unlimited amount of deposits. The total of the deposits may not exceed original amount of the opening deposit. The CSR did not think you could make additional deposits. Leave a comment if you are able to confirm. The add-on feature is limited in value since the add-on is capped to the initial deposit. Update: Another CSR confirmed that the CD does have this add-on feature.

Update: I received additional info from a CSR by email (I'm impressed by the speed of the replies). Below is what I received:

More RateBuilder CD info from the CSR:

The CD does have an add-on feature. You will be able to make additional deposits to the CD up to the original deposit amount without extending the term of the CD.

The CD starts earning interest on the business day that they receive the initial deposit. The CD rate that you will receive on the CD is the rate as of the date that they receive the application.

When the CD matures, you may elect to have those funds withdrawn by a mailed check, ACH transfer or wire transfer. You can close the CD over the phone. They'll use security questions to verify your identity.

More RateBuilder Savings Account info from the CSR:

I confirmed that they had mistakenly listed the rates instead of the APYs for the first two tiers on the RateBuilder webpage. It was correct in the disclosure. I've corrected the rates above.

The CSR didn't provide many additional details on their ACH bank-to-bank transfer service. They do seem to have such a service, and transfers are free.

You may fund the account by mailing a check, wire transfer or by ACH. This also applies to the RateBuilder CD.

Health Savings Account

Thc CSR confirmed that their Health Savings Accounts (HSA) are also available nationwide. A reader commented that she has been happy with their HSA for the last 3 years. It's a tiered account with rates that range from 1.04% APY to 2.53% APY as of 5/08/09. Refer to their HSA rates page for the latest info, and for general info and good nationwide options on HSAs, refer to this post.

Overview of Choice Financial Group

Choice Financial is a small bank with 11 branches in North Dakota. You can review the details about their financials at this FDIC page. They have some solid ratings for safety and soundness: 3.5 stars (good) at BauerFinancial and 4 stars (sound) at Bankrate.com. Both ratings are based on 12/31/08 financial data. The bank has been FDIC insured since 1934 (FDIC Certificate # 9423).

Thanks to the reader who emailed me news of these online accounts.

Update 10/22/09: The bank now only accepts new customers from ND and MN. Rates are no longer listed at the bank's website. Call bank for latest rates.

CornerStone Bank is offering a rewards checking account that pays 3.60% APY for balances up to $50,000 (1.50% for above) and refunds ATM fees nationwide if the following monthly requirements are met:

• 10 debit card purchases
• one direct deposit or automatic payment
• electronic statements
• log into online banking

If these are not met, the rate falls to 0.25%. Minimum initial deposit is $100. There are no minimum balance requirements and no monthly fees.

The top yield of 4.35% as of 12/12/08 is a little low for reward checking accounts, but this is good for balances up to $50K. Another plus is a high yield of 3.01% for balances over $50K. Typically, the yield for balances over the cap is 1% or lower.

Update 10/22/09: It has been reported that the bank has changed its policy and now only accepts applications from residents of North Dakota and Minnesota.

I spoke with a banking rep, and I was told they can open accounts by mail from people outside of North Dakota. They'll mail you the documentation. They require a copy of your driver's license and a notarized signature card. Their toll-free number is 1-888-297-2100. I learned they started this reward checking account in October 2007, and the top APY had been 5.01%.

Branches are located in the North Dakota cities in Enderlin, Fargo, Sheldon, Fort Ranson, Lisbon and Bismark. The bank has been FDIC insured since 1934 (FDIC Certificate # 13198).

Other Rewards Checking Accounts

To find reward checking accounts in other areas of the nation or to learn more about these accounts, please refer to my High Yield Checking website.

Edit: Added info on its availability for people outside of ND.

Rate History:
10/22/09: No longer available nationwide. Bank only accepts ND and MN residents.
03/11/09: 3.60% APY up to $50K; 1.50% APY over $50K
12/12/08: 4.35% APY up to $50K; 3.01% APY over $50K

Edit 6/14/09: Removed link to out-of-date checking page.

Update 6/27/08: Rates have fallen. The new rates and terms are: 5.00% APY 59-month, 4.75% APY 45-month, 4.00% APY 25-month and 3.30% APY 13-month. See bottom of post for a history of the rate changes. The title has been modified to reflect this change.

US Bank has increased the rate on its CD specials. The new 59-month CD yield is 4.75% APY, and the 43-month CD yield is 4.25% APY. The shorter term yields are much lower: 3.50% APY for a 23-month CD and 2.80% APY for a 11-month CD. I reported on this special 59-month CD last month when the yield was 4.50%.

As I mentioned in that last post, one important detail regarding this CD is a severe early withdrawal penalty. According to the CD disclosure, the penalty for the 59 month CD would be over 29.5 months of interest on the amount withdrawn. Here's how it's described in the disclosure:

If your account has an original maturity greater than one year, the penalty will be the greater of either A or B, plus a $25 early withdrawal fee.

A. One-half of the interest that would have been earned on the funds withdrawn if held for the entire term.

B. 3% of the amount withdrawn.

Early withdrawal penalties for long term CDs are typically only 6 months of interest, so this is much worse. If inflation forces interest rates to shoot up, a small early withdrawal penalty can save you a lot of money, when you want to close the CD and move the money into an account with a higher rate.

US Bank does have an online application. However, I called their toll free number (1-800-US BANKS), and I was told you can only open the CD online if you already have a checking account with them and you use the checking account to fund the CD. Otherwise, you have to come into one of their branches. They do not accept checks by mail to fund a CD.

US Bank has branches in 26 states. Below is the list of states with the number of offices in each:

Arizona      -  60    Arkansas     -  47 
California   - 338    Colorado     - 147
Georgia      -   1    Idaho        -  91
Illinois     - 128    Indiana      -  24
Iowa         - 110    Kansas       -  31
Kentucky     - 125    Minnesota    - 135
Missouri     - 219    Montana      -  25
Nebraska     -  61    Nevada       -  58
North Dakota -  25    South Dakota -  20
Tennessee    -  27    Texas        -   1
Utah         -  45    Washington   - 187
Wisconsin    - 127    Wyoming      -  14

The bank also has branches in Ohio.

It's a large bank with $232.8 billion in assets. It has been FDIC insured since 1934 (FDIC Certificate # 6548).

Other High Certificate of Deposit Rates

On Sunday I reported on a better long-term CD deal (higher rate and smaller early withdrawal penalty) at M&I Bank (see post). Unfortunately, it's available in fewer states. I have several other high yield long-term CDs available nationwide in my last weekly rates update. Some of the banks offering these CDs include KeyDirect, Wachovia, National City, Capital One and E-LOAN.

Rate History:

Update 6/14/08: Rates have increased! The new rates are: 5.25% APY 59-month, 4.75% APY 43-month, 4.00% APY 23-month and 3.50% APY 13-month.

Update 5/31/08: Rates have increased! The new rates are: 5% APY 59-month, 4.50% APY 43-month and 3.75% APY 23-month.

Update 5/24/08: The 59-month CD yield has fallen from 4.75% to 4.65% APY, and the 43-month CD yield has fallen from 4.25% to 4.10% APY.

Update 12/08/09: The top rate is scheduled to fall to 3.65% APY effective January 1, 2010. Refer to the bottom of the post for the rate history.

United FCU is offering a reward checking account called Interest Plus Checking that pays 3.65% APY on balances up to $25,000 (0.25% for above) and refunds ATM fees of up to $25 per month if the following monthly requirements are met:

• 10 signature-based debit card transactions
• one direct deposit or ACH
• receive your statements electronically

If these are not met, the rate falls to 0.10%. There are no minimum balance requirements. One downside mentioned in the small print is that this account is not eligible for free checks.

Membership is open to those who live, work, worship, volunteer or attend school in parts of Southwest Michigan, Ohio, Eastern Oklahoma and Western Arkansas. You can also be eligible to join via Select Employer Groups and via immediate family. Refer to the credit union's membership page for the full details. Membership requires a minimum $5 deposit into the savings account.

Branches are located in Michigan, Ohio, Arkansas, North Dakota and North Carolina. The credit union is federally insured by the NCUA (Charter # 6288). It has $749.6 million in assets and 79,075 members as of May 2008.

Thanks to the reader Mike who mentioned this account in the finding-the-best-deals post.

For other high yield reward checking accounts and to learn more about these accounts, please refer to my High Yield Checking website.

Edit 6/14/09: Updated FOM to include parts of Eastern OK.

Rate History:
01/01/10: 3.65% APY up to $25K
04/01/09: 6.01% APY up to $25K; 0.25% over; 0.10% base
05/04/08: 6.01% APY up to $25K; 0.50% over; 0.10% base