About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Survey of the Best CD Rates for August 17, 2012


Survey of the Best CD Rates for August 17, 2012

After several months of holding steady, Patelco Credit Union lowered the rate of its 7-year CD special from 2.50% to 2.00% APY. Before this rate cut, this 7-year CD was the clear rate leader for long-term CDs. Even with this change, it continues to be competitive, but it's no better than PenFed's 7-year CD which has a 2.02% APY. Discover Bank's 2.00% APY 7-year CD is actually a better deal than these two credit unions since it has a smaller early withdrawal penalty (9 months vs. 12 months of interest).

We lost another rate leader for the short-term CDs. However, unlike Patelco, this bank's special rates didn't last long. Starting in July, iGObanking.com had been offering a 1.15% APY 13-month CD and a 1.20% APY 18-month CD. These rates fell to 0.15% which is low even for brick-and-mortar banks. It has always been typical with iGObanking.com to make big rate changes. If you have CDs with this bank, it's critical that you keep track of your maturity dates so you don't let CDs automatically renew. The new rate could be a very unpleasant surprise.

Doral Bank Direct had been a rate leader for 1-year and 3-year terms, but that changed this week with rate cuts for both of those terms. On the plus side, Doral Bank Direct raised its 6-month and 9-month CD yields to 0.93% and 0.98% which puts them near the top for short-term CDs. It's even higher than Ally Bank's 11-month No Penalty CD rate which had a slight drop this week with the rate falling from 0.94% to 0.92%.

US Senate Federal Credit Union's 2.12% APY 5-year CD continues to be on top for nationally available 5-year CDs.

It has become difficult finding 2% CDs. I decided to add two all-access credit unions which are also offering 2% 5-year CDs. The first is Mountain America Credit Union which has been offering a 2% APY 5-year CD since 2011. I last reviewed this credit union and CD in June.

The other credit union that I added to the list is Connexus Credit Union which is offering a 2.00% APY 5-year CD and a 1.00% APY 6-month CD. The downside with these CDs is that they require an active checking account to maintain these top rates. I used to include Connexus last year when it was offering a 3% 5-year CD, but I took it off the list when the rate dropped to 2%. But now with 2% becoming so hard to find, I decided it was time to put it back on the list.

Local CD Deals

I added new CD deals from Doral Bank NY. It has two very competitive CD rates: a 1.50% APY 2-year CD and a 1.75% APY 3-year CD. Unfortunately, the rates of its checking and money market specials fell this week, but they're still good deals as compared to short-term CDs. A branch visit to one of the bank's New York branches is required.

Just like the nationwide CDs, we had a rate leader make big rate cuts this week on the local CDs. First American Credit Union with branches in Arizona and New Mexico had a 2.52% APY 5-year CD which had been available since 2011. That plummeted this week to 1.60% APY. Its other CD rates also fell and are no longer competitive. Thus, I removed these CDs from the list.

If you're looking for a 5-year CD in Arizona or New Mexico or a few other states, BBVA Compass continues to offer a 2% 5-year CD. This is the largest bank that is still offering a 2% 5-year CD. Unfortunately, you have to live near one of their branches to be eligible to open a CD. BBVA Compass branches are located in AZ, CA, CO, NM, AL, FL and TX.

I found two large credit unions this week that are still offering 2% 5-year CDs. The first is Idaho Central Credit Union which is offering a 2.15% APY 5-year bump-up CD. According to the credit union, "most residents of Idaho are within our field of membership and are eligible to join."

The other large credit union is Police and Fire Federal Credit Union. I first reported on this credit union when it was offering a 4% 5-year CD. I stopped tracking it when the yield fell to 2%. But the 2% has held, and it's again competitive. Anyone in Pennsylvania is eligible to be a member by joining an association.

If you want a CD rate higher than 2%, it's even hard to find these for maturities of 10 years. I added Frontier State Bank in Oklahoma City which is offering a 2.42% APY 10-year CD. There are just a few CD rates that are higher than this. Most are in Texas.

Long-Term CD Break Strategy

For the short-term CDs in my lists, you might notice CDs with the note "5-year CD closed after X years". These take into account the yield after the early withdrawal penalty is applied. Since Ally Bank's 5-year CD only has a 60-day interest penalty, it's still a good deal when closed early even with the recent rate cuts.

The risks of planning for early withdrawals of long-term CDs was recently highlighted by another credit union which raised the early withdrawal penalty on existing CDs. The credit union is CEFCU which is based in Illinois. I have more details in this blog post. CEFCU is now the second credit union which has raised the early withdrawal penalty on existing CDs. Last year Fort Knox FCU did the same thing (see my blog post).

Note About the CD Survey

As I described in my rate table overview, you can use our CD rate tables to find the best rates for both nationally available CDs and local CDs. This CD survey blog posts are intended to highlight nationwide CD deals that may not be apparent in the tables. For example, I'll include the post-penalty yields of a few long-term CDs.

The CD survey blog posts are also intended to highlight the local CD deals that are available in large metro areas. There are many high CD rates, but most of these are at small banks in rural areas or at small credit unions with very narrow fields of membership. In these local CD surveys, my focus is on local CD deals that are in big cities or that are available in large areas of a state.

Yields Accurate as of August 17, 2012

Under 1-Year CD Rates

  • Noteworthy Local Deals

1-Year CD Rates

  • Noteworthy Local Deals

18-month CD Rates

  • Noteworthy Local Deals

2-Year CD Rates

  • Noteworthy Local Deals

3-Year CD Rates

  • Noteworthy Local Deals

4-Year CD Rates

  • Noteworthy Local Deals

5-Year CD Rates

  • Noteworthy Local Deals

Over 5-Year CD Rates

  • Noteworthy Local Deals

Note: All rates listed above are Annual Percentage Yields (APY) which factor in compounding.

Related Pages: CD rates
Analisa   |     |   Comment #1
Frontier State Bank has been in the news due to problems there:

Frontier State Bank issued cease and desist order Federal banking officials have issued a cease and desist order to Oklahoma City's Frontier State Bank, affirming a judge's ruling that the business “engaged in unsafe and unsound practices.” Jerry Monroe, executive vice president at Frontier State Bank, said the order is under appeal. He had no other comment. The Federal Deposit Insurance Corp. claims Frontier State Bank...