Hudson City Bank is offering a 2-year CD that pays 2.50% APY. That's the best 2 year CD rate according to the BestCashCow rate tables as of October 5, 2009. The bank is also offering a 3-year CD that pays 3% APY, which is tied for the top 36-month CD rate. There is a $5,000 minimum to open the CD and get the rate.

More information on Hudson City Bank can be found here.

Application and Funding

CD's can be opened in the branch or online. Upon completion of the application, the signature card needs to be filled out and mailed back to the bank along with a copy of a valid driver's license. Funding can be done via a branch visit or electronically via ACH. ACH transfers typically take 2-3 days.

When the CD expires, users can go to the branch to withdraw the cash or do an online request to have the money sent via a cashier's check.

Aurora Bank is offering a 2.45% APY 2-year CD. That's one of the highest 2-year CD rates according to the BestCashCow rate tables. Aurora Bank was formally known as Lehman Brothers Bank and after its parent firm's bankruptcy changed its name to Aurora. The bank did not go bankrupt with its parent.

Aurora is headquartered in Wilmington, DE, has $5 billion in assets and provides loan servicing to 400,000 customers.

Opening and Funding a CD

Applications to open a CD can be done online. Once the application is submitted, the rate is locked for 10 business days. A welcome kit is also sent that includes a signuture card and a deposit slip. Funding can be done via this deposit slip or by wire transfer.

Aurora Bank Safety and Soundness

Aurora Bank is ranked 0 out of 5 stars (the lowest rating available) for its safety and soundess. According to the Office of Thrift Supervision, the bank lost $75 million in the quarter ending July 30 ,2009. It's appears that the bank's mortgage servicing and investing has taken a hit, like many of its peer banks. The increase in cd rates may be an attempt to maintain its deposit base. We saw the same behavior with Indymac, Wamu, Wachovia, etc. before they were purchased or taken over.

For those that decide they want the rate, Aurora is FDIC insured (FDIC Cert: 30890) and has been since 1958. As long as you don't invest above FDIC limits, your money is safe. But there have been instances when a bank is seized by the FDIC that the rate on a CD is not honored by the acquiring institution. The new institution is not under any obligation to do so. That is the risk in investing in a bank that my be impaired.

• Compare 24-month CD rates.

newdominionDirect.com is offering a 2.76% APY 36 Month CD. That's currently (9/29/09) one of the top 36-month CD rates for that term. newDominionDirect.com is a division of NewDominion, which is a niche financial services company based in Charolotte, NC. The bank has 4 domestic branches and as of June 30, 2009 had $562 Million in assets. It's deposit base is $481 Million.

The 36-month CD can only be opened online. Once the application is completed, the rate locks for 10 business days during which the account can be funded via a check or an electronic ACH transfer. A signature card is also sent and must be sent back although that will not prevent the account from being opened.

Once the term of the CD has ended, it can be rolled-over at whatever the prevailing rate may be or can be cashed out. If it is cashed out, the funds are sent via a certified check.

NewDominion has a 3 out of 5 star rating (Adequate) from Bauer Financial for its safety and soundness. The bank and its deposits are FDIC insured.

• Compare the best 36-month CD rates.