Accounts can be opened nationally via an online application. The account can be opened instantly online as long as all of the information can be verified. Once that happens, you'll be able to transfer money via ACH, which takes between 2-3 days, or by wire, which takes 24 hours. The rate for CDs locked when UFBDirect receives the funds.
It's unclear which bank will receive the money but all three are FDIC insured. UFBDirect seems to act as a deposit broker for these three banks. As long as you are under FDIC limits this doesn't represent a problem.
Discover Bank emailed me the other day to let me know they have a redesigned website with some new features. I took a look and it also prompted me to see how they were doing on rates.
Discover Bank emailed me the other day to let me know they have a redesigned website with some new features. I took a look and it also prompted me to see how they were doing on rates.
In terms of the website, here's what's new:
Financial calculators. They added four new financial calculators to help you see how Discover rates compare to national averages. These include:
Savings Goal Calculator - helps you understand the trade-off between monthly contribution and savings horizon to reach your savings goal
IRA Calculator - this calculator can help you understand how your money will grow tax-free over time through investing in FDIC insured CDs in an IRA account
Money Market Calculator - use it to compare Discover Bank rates against the national average for various deposit amounts
CD Calculator - use it to Discover Bank rates against the national average for various CD terms
They also added some new content including articles on FDIC insurance coverage limits, and retirement savings goals.
Perhaps best of all from my perspective, they've expanded their phone service support to 24x7.
Competitive CD Rates
Discover has had competitive CD rates for some time. At the moment, their most competitive terms are 3 year, 4 year, and 5 year CDs. For 5-year CDs, they have an especially competitive rate that's currently at 3.5% APY.
E Loan is waiving the early withdrawal penalty on CDs for the month of March. It may be helpful for consumers who need the cash but it's also a move by E Loan to phase out high yielding CDs.
E Loan is waiving the early withdrawal penalty on CDs for the month of March. It may be helpful for consumers who need the cash but it's also a move by E Loan to phase out high yielding CDs.
In December of 2007, the average rate on a 3-year CD was 4.72% APY. Last week, the same CD yielded an average rate of 3.10% APY. Rates have tumbled over the last six months and banks are looking at ways of reducing the amount they pay in interest. So, like a homeowner refinancing their mortgage, or a bond issuer, calling a bond, they are looking to call back as many higher yielding CDs as they can. Banks are also awash in deposit cash and can afford to let high priced money go and replace it with lower cost deposits.
The text of the email is below:
E Loan Email
Times are Tough - and we’d like to offer a helping hand!
Recently, many customers have been asking to close their existing E-LOAN Certificates of Deposit (CDs) early. Our customers note they need access to these funds due to financial hardship or for paying off debt. We’ve listened to our customers and come up with a unique offer.
For the entire month of March 2009, E-LOAN will waive its Early Withdrawal Penalty if you close your CD early. For many of our customers this could mean substantial savings in penalties normally associated with early account closure.
CD Term Early Withdrawal Penalty
1 year or less 3 months simple interest
More than 1 year 6 months simple interest
If you would like to continue maintaining your CD with us, please rest assured your funds are safe and will earn the regularly scheduled interest for the existing term.
However, if you would like to access your money early, please adhere to the following two guidelines: (1) In order to close your CD with no penalty you must log in to your account and send us a secure message asking us to close your account without penalty. Requests received by Wednesday each week will be processed by the following Friday. Funds will be received in your externally linked account the following week.
(2) Your account will be closed and funds returned to your externally linked account, which must still be open, valid and verified in order for the funds to be returned.
Act quickly; this is a limited time offer and one part of the E-LOAN stimulus package!
BestCashCow is the most comprehensive bank rate site on the Internet. Since 2005, we have monitored savings account, money market account and Certificate of Deposit rates from over 8,000 banks and 7,700 credit unions to find and display the best offers for those looking to earn and save more. You can learn more about the company here.
BestCashCow is the most comprehensive bank rate site on the Internet. Since 2005, we have monitored savings account, money market account and Certificate of Deposit rates from over 8,000 banks and 7,700 credit unions to find and display the best offers for those looking to earn and save more. You can learn more about the company here.
