BankDirect's Money Market Account Review
UPDATE 8/21/17: The money market account rate has fallen to 0.15%. According to a CSR, those who opened the account when the APY was 1.35% will continue to receive this rate for 180 days from the time they opened the account.
Texas-based BankDirect has just become the latest player in the rising money market rates playing field, by adding 19 bps to its Money Market Account (1.35% APY).
BankDirect’s Money Market Account (MMA) can be opened with a $500 minimum deposit, but the minimum balance to earn the stated APY is $10k. As stated in the Disclosure Booklet, (page 32),
You must maintain a minimum balance of $10,000.00 in the
account each day to obtain the disclosed annual percentage yield.
Today’s rate increase is the second in two months (for a total of 120 bps) for the MMA, and these two rate increases are the first rate changes since the account debuted in 2009.
Interest is compounded daily and credited on the last day of the statement cycle.
If the account is closed before or on the last day of a
statement cycle, accrued interest for that period will not be paid.
There is no monthly service fee for the Money Market Account. As is standard for money market accounts, there’s a limit of six withdrawals per month. Withdrawals that exceed this limit are charged a fee of $10 each.
12-month CD
The other gem in BankDirect’s product line is the 12-month CD (1.60% APY). The minimum opening deposit is $10k, with no stated balance cap.
As stated in BankDirect’s Disclosure Booklet, the Early Withdrawal Penalty reads as follows:
If your account has an original maturity of 91 days up to and including one year: The fee we may impose will equal 90 days interest on the principal amount withdrawn subject to penalty.
I was discussing the 12-month CD with a colleague who made a good point, based on the current 0.25% APY for the 48- and 60-month CDs, not to mention the 12-month CD IRA that also earns 0.25% APY.
Might want to warn readers to make absolutely sure they don't forget when the CD matures. Otherwise, their 1.60% 1yr CD could automatically renew into a 0.25% 1yr CD, and once the grace period is over, they'll be stuck in it unless they want to pay the EWP.
Availability
BankDirect is the internet banking division of Texas Capital Bank (TCB), a nationally chartered bank headquartered in Dallas. As an internet-based institution, all of BankDirect's products are available nationwide, and customers must open accounts online.
An online application does not necessarily equate to an account that is opened instantly. According to the “Open an Account” page,
1. Fill out the new account form
2. Submit the form electronically
3. Select an option to print the application Master Deposit Agreement or have us mail it to you
4. Sign the deposit agreement (it is a bank regulation to have your actual signature when opening an account)
5. Mail the signed deposit agreement back to us with your initial deposit
6. You will receive your welcome kit in 7-10 days
7. Go to http://www/bankdirect.com and start banking
For those who do not want to utilize the online application, it is possible to complete an application over the phone (877.839.2737), or request a New Account Kit be mailed.
Bank Overview
As the online division of Texas Capital Bank, BankDirect operates under TCB’s FDIC Certificate (# 34383) and shares its financial history.
BankDirect/Texas Capital Bank has an overall health grade of "A" at DepositAccounts.com, with a Texas Ratio of 8.18% (excellent), based on March 31, 2017 data. In the past year, the Bank has increased its total deposits by $424.93 million, an above average annual growth rate of 2.84%. Please refer to our financial overview of BankDirect/Texas Capital Bank for more details.
Texas Capital Bank was established in late 1997 as Resource Bank, N.A., and less than two years later, BankDirect made its internet debut in May 1999. Texas Capital Bank is currently the fifth largest bank in Texas and the 67th largest bank in the country, with more than $20.8 billion in assets.
How the Money Market Compares
When compared to the 176 Money Market Accounts tracked by DepositAccounts.com that are available nationwide, BankDirect's Money Market APY currently ranks second, regardless of minimum balance requirements.
To search for Money Market rates, both nationwide and state specific, please refer to the Money Market rates section of DepositAccounts.com.
How the CD Compares
When compared to the 213 similar length-of-term CDs tracked by DepositAccounts.com that are available nationwide and require a minimum deposit up to $10k, BankDirect’s 12-month CD APY currently ranks first.
The above rates are accurate as of 7/13/2017.
To look for the best CD rates, both nationwide and state specific, please refer to our CD rates table, or our Rates Map page.
