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UFB Direct: the Top Low-Min Savings Account at 5.27%


UFB Direct raised the rate on its High Yield Money Market Savings account from 5.20% to 5.27% APY. It's now the highest rate no-minimum online savings account. Security Savings Bank had been the leader with its 5.40% APY $100-minimum savings account (see post), but yesterday, the bank dropped the rate from 5.40% to 5.25% APY.

It has been almost one month since UFB Direct made the big jump in the rate of this savings account. For much of this year the rate had remained around 4.50% APY. Currently, the rate is 27 basis points higher than the Jumbo Money Market Account rate. So this seems like a temporary promotion, but with no minimums, there's not much of a risk. You can always transfer your money if the rate falls.

According to several customers, the bank does do a hard credit pull. I had reported no hard pull based on info I received from the bank's customer service rep who indicated that UFB only runs a soft credit pull with Equifax, not a hard credit pull. As one of the commenters stated, CSRs are often wrong about this.

For more info on UFB Direct, refer to this previous post.

Not all deposit rates went up at UFB Direct. Long termn CD rates went down again. The rates on all terms over 1 year decreased from 5.20% to 5.15% APY. So the yield curve continues to get more inverted.

[Edit on 9/16/06: Updated info on hard pull]
  |     |   Comment #1
are there any sign up bonuses for UFB Direct right now?
Banking Guy
  |     |   Comment #2
I'm not aware of any. Last year at this time , they had offered one. My guess it that they're doing a high rate rather than the bonus as an incentive this time.
  |     |   Comment #3
UFB's website indicates Jumbo account not at 5.25% but at 5.00% APY. Could it be a misprint?
  |     |   Comment #4
This is not the Jumbo account.

Look at the line right below the Jumbo account that says "High Yield Money Market Savings"
  |     |   Comment #5
Pulls Hard (EQ) regardless of what CSR says.
  |     |   Comment #6
UFB Direct's parent company is merging with Sky Financial. I wonder what implications it will have on the rates offered.
Banking Guy
  |     |   Comment #7
Thanks for the info on the hard credit pull. I also see others reporting this. I updated the post with this info.

Yes, it'll be interesting to see how the merger will affect them. I wonder if it already had an impact on their Bankrate rating. It's now 4 stars and it use to be only 1.
  |     |   Comment #8
Well I got a letter in the mail saying the merger was complete in early december, although doesn't sound like we are out of the woods yet, since Sky Financial is now getting gobbled up by Huntington Bancshares. I actually liked the sky financial deal earlier because now I have a branch 30 mins away from me for my regular bank. Anyway cross our fingers huntington lets ufb continue to have great MM rates. It is really strange the Jumbo account pays less then HYMM account, I don't think it is a misprint, so make sure your in the hymm account, I feel bad for anybody who is silly enough to not have noticed that HYMM is paying more than their 50k jumbo accounts and haven't transfered to the other account.
I have been a member with ufb for close to 2 years now, and most of the time they have very competitive rates.
  |     |   Comment #9
Anybody have experience with the UFB Direct Bill Pay system? Judging from the demo available on their website, the features of UFB Direct's bill payment services seem pretty extensive. Not only is the interface really slick, they have a "Payment Guarantee" policy which implies that your bill payments will arrive before they are due or UFB Direct will take care of it. Kind of strange, but a nice idea in principal for an online bank...
  |     |   Comment #10
What is a hard credit pull?
  |     |   Comment #11
its an inquiry on your credit report which results in a slight decrease in your score
  |     |   Comment #12
I opened a high yield savings and checked soon afterwards, expecting to get the stated 5.31APY. To my surprise, the account was only paying 4.3%. After calling them, they said indeed it was an error and they would correct it, but I wonder how many other people are not getting the right interest rate with that account.

Banking Guy
  |     |   Comment #13
Dean, Thanks for the info. Was the 4.3% listed on the statement, or did you find it out by doing the math?

Hope this mistake isn't widespread. It's easy to overlook a mistaken interest rate especially if you're doing a lot of deposits and withdrawals during a month.
  |     |   Comment #14
I noticed the error by using their automated telephone service, which states both your current interest rate and APY...

  |     |   Comment #15
UFB Direct DOES have ACH. I just set it up today in their Bill Pay options.
Banking Guy
  |     |   Comment #16
Thanks for the info. I think I saw someone say that UFB Direct just recently informed its customers of this new option. So I think it's new.

Does it allow you to set up an ACH link to another bank online? With trial deposits?
  |     |   Comment #17
Yeah, actually they have rather powerful, but weird ACH options. It enables you to make online payments, send people checks and set up linking bank accounts for ACH transfers (verified with trial deposits). Apparently you can link just about any account to your UFB checking account and have the Bill Pay (called "Money HQ") run like Quicken or Microsoft Money where you can track ALL accounts at once (including stocks, etc - I havent tried this part yet). It says it can even check your account balances in your non-UFB accounts and display that information for you in UFB's browser. Wild. It sounds great, except:

- the interface is really strange. It appears to load up another website embedded in the Bill Pay interface. As if UFB has contracted someone to run this for them. It makes me a little nervous having all that information in one place.
- In Bill Pay, your checking account is held with Affinity Financial Corporation, not UFB Direct and not Sky Bank. Im not sure why.
Jonny C.
  |     |   Comment #18
Is there a way to transfer money online? (without having to send a deposit slip in the mail)
Banking Guy
  |     |   Comment #19
As the commenter Joe has described above, UFB Direct just added an ACH transfer system to allow you to make online transfers from your accounts at other financial institutions.
  |     |   Comment #20
UFB's "fees" page ( http://www.ufbdirect.com/ufbdirect/fees.asp ) seems to indicate there are fees for ACH transfers:

Money HQ Services

Each transfer made outside the Bank (Fee shall be deducted from your primary account at monthend)

Next Day Transfer (Fee shall be deducted from the account you are transferring from at the time of the transfer) $7.95
[end quote]

I interpret this to mean incoming transfers are free (except for next day transfers) as are outgoing transfers initiated from another bank. But outgoing transfers initiated from UFB will cost $2.

Does anybody have experience with this, or better understand what this means?
  |     |   Comment #21
I have initiated transfers with both ING and Emigrant Direct in and out of my UFB checking account and there was no fee.

I have not initiated any transfers from UFB...
  |     |   Comment #22
Bill pay service requires a minimum balance of $1500 or a direct deposit.
  |     |   Comment #23
Looks like UFB has closed the Money Market High Yield savings accounts to new members...I guess the only way to lock in the 5.31% is by opening a savings account (with a 10K minimum).
Banking Guy
  |     |   Comment #24
Thanks Joe for the update. I've posted on this here.
  |     |   Comment #25
It also looks like they dropped the rate on this product.

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