Ally Bank’s Removal of Early Withdrawals in Online CD Management
A couple of months ago Ally Bank disabled a useful feature from its online CD management section. This section of Ally Bank’s online account management allows customers to control several aspects of their Ally CDs including renewals, interest disbursement and early withdrawals. The early withdrawal feature was especially useful for No-Penalty CDs. It made it possible to quickly close a No-Penalty CD and transfer the funds (the principal and all the accrued interest) into your Ally savings, checking or money market account. You could also transfer the funds to an outside linked account. Transferring the funds to an Ally account allowed the transfer to be immediate. Being able to quickly close a No-Penalty CD and transfer the funds into a liquid account enhances the appeal of no-penalty CDs.
When customers now enter the early withdrawal section of Ally’s online CD management section, the following message has been displayed since September:
We’re only processing early withdrawals by phone right now.
Call us at 1-877-247-2559. We’re here 24/7.
Ally claims it’s only temporary
There have been claims that this change is permanent. According to my contact at Ally Bank, this change is only temporary. Below is the response from my Ally contact regarding this change:
Ally Bank offers service that is unique in the industry, and we take our customer commitment seriously. We constantly balance both convenience and security measures, and have temporarily taken our CD close and ACH transfer feature offline to strengthen the security for our customers. We intend to reintroduce the capability within a few months. In the meantime, with just a call, Ally’s customer care team can complete the same process on behalf of our CD customers in under five minutes. It’s always a good idea to check the wait times – posted online and on the mobile app –prior to calling.
I’m not sure why it’s taking Ally so long to strengthen the security of this feature. Closing a CD and transferring funds to an external account would be done to a verified linked account just like when you initiate an ACH transfer from your Ally savings or checking account. The online early withdrawal feature also allowed customers to transfer funds to their Ally savings or checking account. That doesn’t seem to be an activity that would have security issues.
On the other hand, I don’t see much benefit that Ally would be receiving by making this change in the current environment. I would assume the vast majority of customers who have Ally CDs have rates higher than rates that are now available. You would think in this environment with very low rates and a large surplus of deposits, Ally would make it easier for customers to close CDs. If rates were rising, Ally would then have a reason to make it harder to close CDs early.
Early CD closures can still be done with help from CSRs
It should be noted that Ally customers still can close their CDs early, but currently, you have to reach an Ally customer service representative. According to Ally’s messages, this requires the customer to call Ally by phone. Readers have also reported being able to close CDs via Ally’s online chat service. DA reader Buckeyes shared his experience closing his Ally No-Penalty CD in the DA Forum (Thanks Buckeyes!)
Ok so Ally has closed my NP CD and the money has been sent to my online savings account. So to summarize my experience, I closed this with a 20 min online chat yesterday. Somehow I was first in line. It took almost exactly 24 hours for the CD to close. So although you cant do yourself, you can do via chat, or a phone call if you wish, and it took them 24 hours via the online chat route to close it. So a bit of a pain but it could be worse. Hope this info helps.
Online account management has been one of the fortes of Ally. Many of the other online banks (especially the smaller ones) have limited capabilities on what the customer can control via their online account platform. I hope Ally is serious about restoring this online early withdrawal feature.
I like Ally as a "hub" bank. Have had accounts there for many years. Has not had the greatest rates in the past couple of years, but great for managing a lot of accounts conveniently. To that end, I don't like them removing features as that makes it less useful and convenient for this purpose. So I hope this is not a sign of things to come there and we can take them at their word they will restore it soon.
I have two large NPCDs there maturing in several days @ 1.95%. Probably will just let them roll @0.65% as lousy as it is as I need to keep these funds somewhat liquid. May end up sending them both out at some point if Ally doesn't come up with some better CD deals.
One time I was unable to get the automated system to recognize my entries for the ATM card info and I was told I had to go to a branch. The branch is down the street from me. Had to show my ATM card and drivers license to the CSR and she had to contact the fraud department to authorize the transaction.
Maybe Ally had some security issues with doing online CD closures. They are the only bank a I've dealt with that allows on line CD closures. Maybe they are adding extra verificationto their processes
Only been dealing with Ally when they offer bonuses. Otherwise their rates have not been competitive for a long time.
Had to go to a branch. I have been a cust of Chase on and off for decades.
Their security systems are set with a trigger finger.
I did have to do a Finacial wellness review with the rep that took 45 minutes. I Opened a basic checking account with $10 and had to make a $500 deposit within 60 days to get the $400 bonus. If I close the account within 180 days you have to pay an early closure fee of $25. I'll be closing the account after the 180 days are up. No other fees apply to get the bonus and no direct deposit. The only fees are basic checking fees like bounced checks. Just a Checksytems check and no credit agency inquiries. I have no intention of using this account.
I've been doing bonuses in this low rate environment. Put 15k in a Chase savings account and after 3 months getting a $200 bonus. Opened a Chase Brokerage account with 25k and will get a $200 bonus and can close after 90 days. We opened a Fidelity 2% on all purchases charge card and got a $150 bonus after charging $1,500. My wife opened that and she has an 850 credit score. Next going to open a Chase Freedom rewards card and get a $200 bonus after spending $500. My credit score is 850 so no worries. Looking at doing a Citibank $400 bonus offer on opening a Checking and savings account with 15k between the two for 60 days
Also Can you send the link for the American Express card that pays 6% on all store purchases? I would like to get that card.
On First Merchants Bank of Indiana, Ken had a write-up a few days ago. No sign up bonus. There are a few comments on DA from people who applied recently.
Second- On Merchants bank I am waiting for some more reviews. I have pee poor luck moving money between banks as capital one and discover went down almost as soon as I did a transfer earlier this year. The .4 % difference between Merchants and Ally (and almost everyone else) is something to consider though. The 1% is a bloody long term CD rate nowadays. What's the expression? If it sounds to good to be true...
I am sticking with Ally since I don’t have much liquidity. Very grateful to Ken/DA (for all those add-on CDs last year) and DoC for bank bonuses.
@Rickny - I am doing the Citi bonus (for the second time). The application process seems to have improved. Someone says Citi typically offers the $500 bonus in the January round but I didn’t want $15k sitting in my savings account earning 0.6% APY.
Next month I'll go for the Citi bank bonus.
If this post gets deleted by the moderators, I will send you a private message.
I had this CD for about 3 months and when i wanted to withdraw funds to my Chase Checking Account (which was already verified and set up as an external account) I was asked to call 1-800-247-2559/
I was on the phone for about an hour and then I decided to chat message and received no response.
I had to call ALLY Bank another day and wait about an hour to talk to a customer service representative to withdraw my money out of the ALLY no penalty CD. I finally was able to withdraw my funds, but it shouldn't be this difficult to contact ALLY and receive a response when cally 1-877-247-2559. The bottom line-don't expect to be able to retireve your money within a reasonable time frame (in my case it took more than a day to get a response from an ally bank customer service rep) from the 6 day no penalty cd. When I wanted to put the funds into the ally account from my chase account (depositing funds) I received a response right away. Cathy Mc.