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Pentagon Federal Credit Unioin's 4.75% 3-Year CD


If you weren't able to advantage of PenFed CDs last month when the yield was 5%, you still have the opportunity to open a 4.75% APY 3-year CD. Last month a 4.75% 3-year CD wasn't that great, but now it's on top for a federally insured institution.

In addition to a 3-year term, the 4.75% APY applies to 4, 5 and 7-year terms. PenFed's CDs have a minimum deposit of $1,000. They're also available as Coverdell Education Savings Certificates and as IRA Certificates. PenFed CD rates typically last through the month.

For more details about PenFed's CDs and joining PenFed, please refer to this PenFed review post. PenFed makes it easy for anyone to join and open accounts online. If you don't qualify based on military, employer or family, you can become eligible by joining the National Military Family Association (NMFA). Please refer to How to Join Overview Page for details. Joining NMFA and Penfed can be done at the same time all online. The yearly membership for NMFA is $20, but your membership in the association does not need to be maintained to continue as a Penfed member

Credit Cards and Mortgages

In addition to high CD rates, PenFed has several other competitive banking products including a cash back Visa credit card with 5% cash back for gas purchases and auto loans with very low rates (see post). Also, PenFed is known for good mortgage deals. They currently have a 30-year fixed mortgage with an APR of 5.375%.

PenFed's financial rating for soundness at Bankrate.com has improved since last year. It's now 4 stars (sound) based on 9/30/08 data (up from 3 stars last year). PenFed's rating at BauerFinancial remains at 5 stars (superior) based on 9/30/08 data.

PenFed is one of the largest credit unions in the US with $12.7 billion in assets and 846,549 members. It's federally insured by the NCUA (Charter # 227).
Related Pages: CD rates, IRA rates

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Waterman   |     |   Comment #1
I am a member of Pen Fed. I have been very happy with them. I was able to get a 6.25 APY on 5 yrs back in 1-2007. They often will have a short offer of well above the current rates. Must keep checking to find it. Their credit card has one of the best, if not the best for cash back, which is credited to your account balance each month. 5% gas, 2% food 1.25% on everything else.
Anonymous   |     |   Comment #2
I am a member of this credit union too. I also had a home equity loan with them that just got paid off earlier this year so I don't have any debt on the house anymore! Their longer term CD rates have been very good. The shorter term ones are not as competitive as other online banks. They do offer attractive loan and credit card rates. One thing to note that is effective February 1, 2009. If you don't sign up for electronic statements, they will charge you a fee for mailed statements (I think it is $5). Only people who can prove that they don't have Internet access will be exempt from this new fee. Another push to reduce paper clutter and save on postage. If you are a pack rat like myself, this is not good news. I follow the rule that restricting my relationship to a bank solely by online means is to be avoided since online access is not guaranteed at any given time of day or location (for example, if you became disabled or sick for a long period of time, computer access may not be a viable option).
scott   |     |   Comment #3
Was talking to a rep at Pentagon this morning and he told me as usual they will be doing a rate change at the end of the month.
3 year will be 3.94%
4 year 4.25%
5 and 7 year 4.50%
Anonymous   |     |   Comment #4
I am correcting my earlier post back on 2:36AM on December 18, 2008. The mailed statement fee that will be effective on February 1, 2009 is fifty cents and NOT $5.00 as previously reported. Sorry for the error. You can sign up for e-statements, direct deposit $500 each month to a checking account, or request a waiver because of lack of internet access in order to avoid the fee.