These are the 3% CDs that were acquired from Valor. You would think they would want to get rid of them, but their answer is if they allow it for one member they have to do it for everyone. So far, I don’t know anyone who has ever got PenFed to waive an EWP. Let me know if you hear otherwise.
I own the 5% CDs , no way I would ever cash them in.
Agreed. Perhaps I should have mentioned my correspondence with the NCUA wherein I cited those very regulations. Perhaps I should have mentioned the lawsuit which came in the wake of one effort to skirt the 30 day rule.
Did I need to mention resignation by the president of one of those credit unions, USCU, in the wake of the debacle he created by ignoring that 30 day rule?
Been there. Done that. Feel free to remain in denial. I have no problem with that whatsoever. But this is my thread and I have neither intention nor desire to see other participants harmed by counterfactual posts. Let me put this plainly:
A financial institution offering an add-on CD is permitted to withdraw that same add-on feature provided they first provide account holders thirty days’ notice of the change.
Period.
What is the “instant interest” feature at Pure Point?
@goldendog As soon as you initiate an ACH transfer using PurePoint’s transfer system, the funds being transferred are immediately added to your PurePoint account balance and you begin earning interest on them. Initiating an ACH transfer utilizing PurePoint’s system on a Friday evening means you earn double interest on the money being transferred because PurePoint starts paying interest on Friday and the bank you’re pulling from also is paying you interest for Friday. This double interest continues on Saturday and Sunday. It’s even more lucrative on a holiday weekend as you can imagine.
You earn interest from the moment you schedule the ACH transfer. For example, I cashed in a large CD this afternoon at a credit union, requesting the funds be moved to my savings. Prior I had linked that savings account to PurePoint.
Once the CD funds were in savings I went over to the PurePoint website and executed there an ACH transfer of those (formerly CD) funds to my PurePoint savings. Obviously those funds will not actually be available to PurePoint until Monday morning. But they commenced paying me interest on the full amount today. It was a lot of money in a CU savings account paying 0.1% APY. I had no way to earn interest instantly, other than by using PurePoint, short I suppose of wiring the funds.
Probably should mention it is thirty calendar days, not thirty business days. Weekends count. Holidays count. So you end up with fewer than thirty business days to get your final add-on money in, once you receive notice.
Any cap on the 3.25% add-on CD at Freedom? Do you live in their geographical boundaries?
Not as far as I know, but at this point it is anyone’s guess. That was my concern earlier today. I will be trying more add-on deposits going forward, hoping for the best.
Uncertain about the geography question. I joined back when anyone was permitted to join, regardless state of residence. The rules today are different.
I also have Freedom CU CD’s. In fact I have 2, they are 3.5% Promo CD’s. I called to inquire if mine were add-on’s as you & shinobi were discussing. I was told no. It is to bad for me. 
So, just wondering when you guys got your Freedom add-on 3.25% CD’s? Sometimes we are all following the same angle as far as these CD’s are concerned. I used to be looking for short term, think I missed the boat!! Big Time!!
Opened mine during winter, early in 2019, for $500, strictly as insurance against catastrophe, which I never really thought would come to pass. Wrong again.
In an effort to be as clear as I’m able:
I’m asserting the above based on actual, personal, experience. In other words: it’s already happened. Twice.
That actual experience is not overcome by theoretical constructs. You can argue:
“That could not have happened because if it did then this other thing also could happen”.
I make no claims about other things which could happen, changes to interest rates or other CD account terms, for example. This is because I have no personal experience with such things. None.
But I do have considerable experience with financial institutions withdrawing add-on CD provisions to which they agreed when the account was originally opened. It is on that aspect alone that I am making my assertion. I know those provisions can be withdrawn because I have experienced the phenomenon twice, personally, over the years.
Would financial institutions get away with making other changes? Would the NCUA turn a blind eye? I candidly have no clue. I’m unaware of any such thing, e.g. an interest rate or term change or whatever, ever having happened. Of course it might have happened and I’m simply unaware. It never happened to me, I can tell you that.
But recission of an add-on promise? Well, there is certainly ample precedent and that did, indeed, happen to me twice following notice.
You don’t explicitly. But you do keep insisting on a “30 day notification” rule. And the only such rule in any banking regulation applies to all demand deposit account terms, not just one specific term; to say that rule applies, is saying that the interest rate, length, penalties, and literally everything else in the terms would be subject to be changed with 30 days notice. There’d be no such thing as callable CDs, because all CDs would by rule be callable.
Your experience of a bank getting away with it a couple time does not make it a rule.
It is not a promise, it’s a contractual term.
Yes I do. Because that is the rule.
This is true. When last I posted I was unaware of any such thing ever having happened, and as I stated those other changes have never been inflicted upon me.
But I was wrong. I forgot the INFAMOUS Fort Knox FCU (FKFCU) debacle back in 2010-2011 and the way savers were screwed by the NCUA. It was as if the NCUA existed to protect the credit unions, and not us.
In my defense, I was never a FKFCU member. This happened to other people, not to me; which is why the incident was not front of mind for me. But the assault on people who were FKFCU members was so egregious, and so notorious, I should have remembered anyway. Ken wrote about this. Note FKFCU changed the terms of EXISTING CD accounts, increasing the EWP (early withdrawal penalty) of those accounts. When FKFCU members opened those CDs they entered into a contract with FKFCU. The NCUA allowed FKFCU to alter that contract unilaterally, following thirty days’ notice. Here is Ken’s post in response to the NCUA decision (it took them forever to rule):
Ken addresses the NCUA’s 2011 FKFCU ruling
Here is a lift from Ken’s write up where he mentions the thirty day rule:
For share certificates with maturities greater than one month, the credit union would have needed to provide affected members with a written change-in-terms notice at least 30 calendar days before the effective date of the change in accordance with Section 707.5(a)(1) of the NCUA Rules and Regulations.
Since the credit union reserved the right to change terms in the Membership Agreement, the credit union would not have violated a federal consumer protection law or regulation regarding this matter provided it complied with the written notice requirements outlined in Section 707.5(a)(1) of the NCUA Rules and Regulations.
Then Ken wrote (and I agree):
In my opinion, it seems unfair to overturn an important term (the early withdrawal penalty) that’s explicitly specified based on generic clauses that are in different sections of a large document. The worry is that all banks and credit unions have similar disclosures with similar general blanket clauses that give them broad rights to make account changes.
Also, regulations require institutions to provide at least 30 days written notice before the changes are made.
I have stumbled upon an additional slimy use of the 30 day rule, this time by a perfectly healthy bank. Instead of writing myself about this I will once again refer you to Ken’s rather extensive and detailed description of what happened:
Ken details the debacle at Main Street Bank
Here, again, we have a financial institution using the thirty day rule, to their financial advantage, to facilitate changing CD terms after the CD is opened. The only real difference here is that this is the FDIC’s version of application of that rule.
There might be other examples out there of this sort of thing. I obviously don’t know them all. But I should more readily have recalled the FKFCU example. That one was a doozy and it had a great many people riled up for a very long time.
Warning: IRA/ESA only IRA/ESA only IRA/ESA only IRA/ESA only
Against all odds the NFCU IRA/ESA only CD remains available. This is a 37 month CD with a 3.00% APY. This has to be the biggest gift horse, the most prominent no-brainer, out there today for IRA mugglers.
You only need fifty bucks to get started and, wait for it, this is an ADD-ON CD!! So for just fifty dollars you can lock in this high 3.00% APY rate for your IRA nestegg, well into the future.
One limitation: this account has a $150,000 deposit ceiling.
Regardless, this IRA CD just screams “grab me” in today’s moribund CD marketplace. And, yes, I have one of these accounts. I’m not so proud to where I would turn down free money. 
I’m going to give this one a try. I never thought I would qualify for an IRA/ESA. So I just ACH transferred $100 into my Navy checking acct. Tomorrow I will open the CD. 
Well I tried. It looks like it’s there but, when you pull down the list to choose, it’s not on the list. Is there something I’m missing?
Dunno, pattyb53.
With so much turbulence in the system now, you know the virus and all, my absolute best suggestion would be for you to telephone them, ask your questions, and talk things over. That way you will have access to the very most authoritative source of information in this special situation.
Go to the certificate page on the website, then click to “learn more” about their limited time special offers.
For add-on CD mugglers out there:
Consider the pandemic did not assert itself with full force until mid-March, plus or minus. Focus here is on impacts seen by the financial institutions.
You want to add onto CD accounts at solid banks and CUs. Otherwise, if a weaker institution fails in future while your money is inside, you might end up losing your high interest rate. Thus, bank and CU ratings are important at this juncture. Here is the rub:
Ratings we are seeing now are based on institution data which was released at the end of 2019. Hence, one cannot rely on those ratings to reflect current circumstances. Even newer ratings, which will take into account first quarter results, once they are released will only include impact from several weeks of the pandemic. I mean, in January and February it was pretty much “business as usual”.
So when you check ratings, prior to placing add-on funds into CDs here or there, be as circumspect as possible. And (personal opinion here) I would be most hesitant to rely on the “polyanna” services. More and more I’m going with Weiss Ratings. Only hope they are tough enough!!
Thanks glitch99… Worked out perfectly…