I write here to share my experience. I have none with any bank. I have never had an add-on CD with a bank. I have no clue how the FDIC reacts when a bank seeks to close off a previously promised add-on privilege.
But I do have experience with the NCUA. I have had, in all, three previous experiences with add-on CDs offered by three different credit unions. In one instance, it was NWFCU, there was no default. NWFCU met the original terms of their add-on promise. In the other two cases the credit unions pulled the same stunt GTE has just pulled. And it was eventually handled by the NCUA as I have already reported up thread.
I understand and respect the outrage of some posters here. I suppose I am less agitated only because this is the third time this add-on outcome has happened to me. I am hardly in position to shout āhow on earth could this have happened!!ā.
You go into these add-ons hoping for the best . . at least I do. Often as not things do not go your way. It isnāt right, but so many things today are that way. Itās sad.
ETA
This just occurred to me:
I vaguely remember, I think it was with Valor, submitting a complaint to the NCUA online when Valor cancelled my right to add onto my CD there. The NCUA has a form . . or they had one back then.
My complaint was taken seriously by the NCUA. They got back to me and they followed up. Of course I almost certainly was FAR from being alone with that complaint. I recall mentioning, in my complaint, their 30 day rule which Valor had not respected.
It took a significant amount of time. But eventually Valor was forced by the NCUA to give proper notice to account owners and then re-open the add-on privilege for thirty days. I did add more funds to my CDs (I had five of them), but it was not an overwhelming amount of money. The money I sought to add-on, during that thirty day interval, was accepted and my interest rate held for those add-on deposits.
So you go into a CD hoping for the best in that the credit union will decide to honor the contracted interest rate for the full term? Or hoping that theyāll let the CD mature as expected, and not simply decide to change the term from 3 years to 7 years? Because if the add-on term is subject to be changed, all those other terms are equally subject to their whim. Nevermind the fact that their ājustificationā for this has nothing to do with it being a CD, theyāre claiming their general membership terms grants them the right to change anything, which would apply equally to CDs, credit cards, and even mortgages.
Iām not saying that the NCUA will choose to enforce this, and according to you they havent. But there are really good odds that a judge would, should you or anyone chose to pursue it in court.
I am very sympathetic to your outrage, glitch99. I respect your thinking. What GTE has done is clearly unfair and manifestly wrong. Period.
Itās just that this is not my first or second rodeo where this sort of thing is concerned. In both previous instances, as already reported, the credit unions ceased to exist after pulling this stunt. Same could easily happen to GTE it seems to me.
Only remaining point I can make is to remind everyone resolution of this matter is most likely to consume a lot of time. The NCUA gears revolve very, very slowly. Itās a molasses in January situation. At least that is how things went in the two prior instances where I was involved.
Again, I can only report here from my personal experience. I have nothing else to offer.
Yes, I almost included this wildcard at the end of my comment. In this case, being proven ārightā may not be the best long term outcome for anyone. Itāsā¦delicate.
I apologize for any possible misunderstanding. My fault.:
When I wrote the other two CUs ceased to exist, I did not mean to imply that depositors were harmed. Both were simply taken over by other credit unions. PenFed took over Valor. USCU was taken over by another CU in the Asheville, NC region. No depositors were harmed insofar as Iām aware.
Of course the people running the failed credit unions did not come out all that great, which seems fair to me. Just deserts and all.
When I complained formally, online, regarding Valor it might have been directly to the NCUA . . . or
I might have filled out a form on the CFPB website.
I cannot recall now which it was. But if I did contact the CFPB first, they simply forwarded my complaint message to the NCUA straightaway. This situation is a matter for the NCUA to resolve.
You folks are all involved with GTE add-on, but I hadnāt planned on using it because mine is paying 2.75%. I have another add-on CD paying 3%, so āI feel your painā, but hope you work it out.
I made such a stupid mistake this week.
I worked since Monday to get funds ACH transferred from Alliant CU to PSECU to open that 3yr- 3.25% CD. But when making my moves I mistakenly transferred those funds to Grow. When I opened Grow early this morning all my money was sitting in the checking acct. All of a sudden it dawned on me that I meant to send it to PSECU & now itās all in Grow.
Iām sure PSECU will not still be running that good offer this next week.
But a failed bank can mean broken CDs. You donāt lose money, but you could loose the remainder of this 5-year rate. With how rates and the economy could go over the next few years, do you see anyone being willing to take over a large quantity of accounts that are locked in at 3.3% with unlimited ability to add additional funds?
I agree and I take your point. PenFedās takeover of the Valor accounts happened AFTER the 30 day add-on period had expired. Hence, the add-on privilege had already been extinguished by the time PenFed became involved. PenFed honored the interest rate, though.
USCU went down more than a decade ago. I simply am unable to recall exactly what happened. I think my money was already out of USCU by the time they were taken over. I suffered no loss.
While the promotion is no longer being offered for new share certificates, GTE will continue to honor the terms of the share certificates that were opened by members during the applicable promotional period and allow for additional unlimited deposits.
If you have additional questions regarding your certificate, please reach out to Member Care at 1.813.871.2690 from 7am to 8pm. Thank you for being a GTE member and for trusting us with your deposit.
Am I the only one to read this and think there is a āFOR NOWā missing in this communication?
Itās clear that they donāt want the liability of having to pay 3% interest on unlimited amounts of future deposits. Theyāre just postponing action until they iron out another way to legally not fulfill that commitment.
I got a call from GTE mid-afternoon, following up on my NFCU complaint submitted last night around midnight. Merely stated that theyāve reversed the change and mentioned the email being sent out, so nothing notable, except to highlight the length of time it took to get a response. Such complaints do get priority attention.
If your money is available for withdrawal at Grow, you have the option of wiring the funds to PSECU. For the cost of a wire you will be able to lock the rate. Wire should arrive same day if you initiate it early in the morning eastern time.
I dunno how much Grow charges for a wire . . . probably twenty or thirty bucks. Worth it to lock that 3.25% rate, which is a very attractive rate.
Patty, do you have $500 at PSECU? You can open the CD and then do an add-on later.
If you donāt have $500 there, you may be able to do a mobile check deposit of $500. If the money is on hold, call PSECU and request them to use the money to fund the CD. I would check with the rep first before attempting this procedure.
If you have a Fidelity account, they support same day ACH if you submit it before 8am ET. It will get the $500 to PSECU by 2pm ET.
Another option is to do an add-on to one of the earlier CDs if those have not passed the 30 day limit for add-on.
