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Archive for MainStreet Bank

Best CD Rates For 2011 – Top 5 CD Rates So Far

Friday, September 9th, 2011

CD rates in 2011 have all been but annoying for those looking for a safe haven to invest their money. Since CDs are FDIC insured, they are a safe place invest your money, but with such low interest rates, many have wondered if its really worth placing their money in a locked up investment. More frustration comes with little glimmers of hope as interest rates bounce around their all time lows. Some financial institutions offer an increase in interest, but soon after cut their rates back down to record low levels. Even credit unions, who only open their doors to specific crowds, tend to have the best interest rates, but they make it nearly impossible for the average saver to cash in on their rates.

As of September 9th 2011 the national average for the 6 month CDs and 12 month CDs have dropped to 0.52% APY and 0.84% APY, that’s down from 0.56% APY and 0.90% APY in April 2011. These are rates from the top nationally available FDIC insured financial institutions. Some online banks, local banks and credit unions offer much better rates, but their averages have continued to fall throughout 2011. These CD rates are having a hard time keeping up with inflation rates. Inflation is averaging 2.90% for the first seven months of 2011, already higher than the 1.64% average inflation rate for all of 2010. (Inflation rate data)

The Federal Reserve Chairman Ben Bernanke stated that interest rates would stay at their record low levels until at least mid-2013, giving almost no hope for an increase in what savers might earn off their money. Even though this is good news for people who can buy houses and cars, this is bad news for investors and savers alike.

Where are the best CD rates found in 2011?

If you are looking for the best CD rates of 2011, your best bet would be to look at smaller financial institutions, online banks or credit unions. Don’t bother with going to your local Bank of America branch, Wells Fargo or Chase Bank as these banks offer some of the lowest interest rates on the market. There are exceptions to big financial institutions offering higher CD rates, such as Discover Bank which has a 1.15% APY on their 12 Month CD.

Smaller financial institutions have a lower overhead cost than the traditional large bank. Online banks also have very low overhead costs and therefore can pay a higher interest rate or be more competitive than a large bank such as Bank of America. Credit Unions have offered some of the highest CD rates we have seen in 2011. These financial institutions are usually not-for-profit and owned by its members. Most also only allow a specific group of people to join, while other credit unions such as Melrose will accept anyone. Credit Unions also have strict requirements to become a member and to stay a member. This all allows them to have more control over who they do business with and also allows them to pay a higher interest rate to its members and savers

Top 5 CD Rates Available So Far In 2011 (As of September 2011)

Interest rates can change at a moments notice and while some banks and credit unions offer the best CD rates one day, those rates might have been a promotional rate that has recently expired. Since rates have been bouncing around throughout 2011, be sure to refer to our CD rates page for the most up to date rates.

  1. AloStar Bank of Commerce has a 6 month CD rate of 1.05% APY with a minimum deposit of $1,000.
  2. AloStar Bank of Commerce has a 12 month CD rate of 1.21% APY with a minimum deposit of $1,000. — Connexus Credit Union has a 12 month CD rate of 1.50% APY with a minimum deposit of $10,000, otherwise with a minimum deposit of $500 you get their 0.75% APY.
  3. MainStreet Bank has a 24 Month CD rate of 1.50% APY (the same as Connexus Credit Union’s 12 Month CD), with a minimum deposit of $500.
  4. MainStreet Bank and Melrose Credit Union have a 24 Month CD rate of 1.90% APY with a minimum deposit of $500 and $5,000.
  5. Melrose Credit Union has a 60 Month CD rate of 2.68% APY with a minimum deposit of $5,000.

Back in April 2011 the best 60 month CD rate was from PEF Federal Credit Union in Ohio at a rate of 3.29% APY. As you can see rates are still dropping from earlier in the year.

The financial institutions listed here are available to anyone nationally either by opening an account over the phone or through their website.

Be sure to visit our CD rates page for the most up to date rate information.

AloStar Tops The 12 Month CD Chart

Thursday, September 8th, 2011

AloStar Bank of Commerce is back on the top of the 12 Month CD rates. Is AloStar becoming the next Melrose Credit Union? This online bank who is based in Birmingham, Alabama raised its 12 month CD rate from 1.18% up to 1.21% APY.

This rate move causes AloStar to take the lead over Sallie Mae Bank who offers a rate of 1.20% APY with no minimum balance.

To get the 1.21% rate from AloStar Bank of Commerce, you will need to deposit a minimum of $1,000.

Since the middle of August there have been multiple rate changes, most of them have been cuts. Even AloStar had cut its interest rate on their 12 month CD by a tenth of a percentage point but now has increased their rate back to the top of the list.

Here are the next best 12 month CDs being offered:

  • Sallie Mae Bank is the online bank of the student loan company pays 1.20% APY with no minimum deposit.
  • MainStreet Bank, based out of Virginia but sells its CDs nationally through their (www.airbanking.com) website pays 1.16% APY with a minimum deposit of $500.
  • Virtual Bank, the online bank of Sabadell United Bank out of Miami Florida offers 1.16% APY with a minimum deposit of $10,000.

So far interest rates have continued their overall downward fall, but for how long? No one really knows when interest rates will increase. If you keep watching, some banks offer promotions which come and go as quickly as interest rates have been decreasing. Last year we watched iGoBanking offer some of the best interest rates on CDs and their promotions would only last 2-3 days at a time.

Our CD rate table offers a look at some of the better CD rates on the market today. Be sure to check back often as rates can change at a moments notice.

This past week we have seen the Dow move up and down, but ending the week down 450 points. Many banks have cut their CD rates but overall the top CD rate leaders have held steady. The biggest drops come from a major Credit Union – Melrose. Melrose has consistently kept their rates higher than any other major nationwide bank, but since August 8th they have cut their rates down by about a quarter percent.

Here are the current rates offered at Melrose Credit Union:

  • 12 month CD rates down to 1.05% from 1.31%
  • 24 month CD rates down to 1.31% from 1.56%
  • 36 month CD rates down to 1.81% from 2.07%
  • 48 month CD rates down to 2.07% from 2.32%
  • 60 month CD rates down to 2.57% from 2.83%

For the week ending August 19th 2011, the top CD rate holders have held steady:

  • 3 month CD’s – AloStar Bank of Commerce at 0.76%
  • 6 month CD’s – AloStar Bank of Commerce at 1.05%
  • 12 month CD’s – AloStar Bank of Commerce at 1.27%
  • 24 month CD’s – MainStreet Bank at 1.50%
  • 36 month CD’s – MainStreet Bank at 1.90%, DOWN from 2.00% from August 8th
  • 60 month CD’s – MainStreet Bank at 2.50%

Overall the best CD rates have held steady, but we suspect another drop is coming. Connexus Credit Union was also offering some of the highest CD rates, even higher than Melrose Credit Union but have since dropped their rates also.

Connexus Credit Union requires a minimum deposit of $10,000 to receive the higher rates:

  • 6 month CD rate of 1.25%
  • 12 month CD rate of 1.50%, which is down from 1.75% on August 10th.
  • 60 month CD rate of 2.50%, which is down from 3.00% on August 10th.

With these lowered rates, this puts Melrose back in the lead with the best CD rates you will find on the market. Even thought they are a Credit Union, anyone can join as long as you meet a few requirements such as opening an account and funding a savings account. They also have a minimum deposit of $5,000, which might be a little high for the average saver.

Be sure to check out our CD rates page for the most up to date rate information. CD rates can change at a moments notice so be sure to check with the financial institution about their current rates before investing.