August 1st, 2012
One of the big long-term CD Rate players (Pentagon Credit Union) reduced their 5-year and 7-year rates today. Pentagon typically only changes rates at the beginning of the month (although they have lowered rates a few times mid-month, when a special was getting too much attention or the Fed had a surprise cut).
They lowered their 7-year CD rate from 2.40% to 2.02% and the 5-year from 1.90% to 1.71%. Those are still near the top, however.
CIT Bank began offering a 5-year last month and it is currently paying 1.90% ($100,000 minimum) or 1.85% ($1,000 minimum). They also have top rates on other terms. If you have funds coming up, I would keep CIT Bank on your radar.
Alliant Federal Credit Union is still strong on the shorter-term rates. They have a 1-year at 0.85% and a 1.00% for 18-months. Pentagon also remains competitive at 0.90%. We have a couple of banks paying a little over 1.00%. If you have Alliant and Pentagon already, you may consider giving our service a look. I’ll even reduce our standard fee to 10 Basis Points if you mentions this blog post. We can work with $100,000 or more.
There is still a 7-year CD at 2.40%, but it has a high penalty to close early. Another bank has a 7-year at 2.25% with a 9-month early withdrawal penalty. You can use our EWP calculator to get the equivalent yields. It comes to a 1-year at 0.567%, a 2-year at 1.409%, and a 3-year at 1.689%.
I’m working on an updated graph of average CD rates and I’ll post that later. I’m also working on one that goes back a few years and will include Fed Funds. But, I wouldn’t expect rates to increase anytime soon. And, there is a very good possibility of further rate declines.
Happy CD Hunting,
-- By +Chris Duncan