Archives for August 2009

Citibank is offering one of the best CD rates available for an 18-months certificate of deposit. The current CD rate is 2.25 percent and the current annual percentage yield (APY) is 2.25 percent. The national average for an 18-month certificate of deposit is 1.406 percent this week. This CD rate is a special promotional offer. The minimum opening deposit is $500.

To receive this promotional CD rate you also have to open a checking account, Citibank calls “The Citi Account”. The minimum opening balance is $100. You also have to maintain a  $6,000 combined average balance, “an easy goal to reach” says Citibank.  With just might be if you already bank with Citibank. The following accounts go toward it, Checking, Savings, CDs, Money Market, Lines, Loans, Mortgage and Brokerage (to qualify, accounts must be linked to your ATM/Debit Card.)

If you don’t have a combined balance of $6,000 their is a monthly fee anywhere between $9.50 and $15.00 depending on the checking account you have and the state you live in. If you’re still interested in this promotional CD rate be sure to use promo code CA4B.

Tennessee Commerce Bank is offering one of the top CD rates for a 12-month certificate of deposit. Tennessee Commerce Bank has it’s headquarters in Franklin, Tennessee, is offering a 12-month CD that currently has a rate of 1.88 percent and an annual percentage yield of 1.90 percent. A lot higher than the average national CD rate for a 12-month CD.

The certificate of deposit rate and yield are for CD deposits in the amounts between $2,500 and $99,000. Tennessee Commerce Bank has been insured by the Federal Deposit Insurance Corporation (FDIC) since January 14, 2000. The bank’s FDIC Cert number is 35296.

Right now the bank is also offering CD rates for the following certificate of deposit terms.

• 3-months CD rate of .65 percent
• 6-months CD rate of 1.09 percent
• 18-months CD rate of 1.98 percent
• 24-months CD rate of 2.47 percent
• 36-months CD rate of 2.52 percent
• 48-months CD rate of 2.67 percent
• 60-months CD rate of 2.77 percent

These certificate of deposit rates are as of August 15, 2009.

Danversbank, of Danvers Massachusetts, is offering two promotional CD rates are some of the best CD rates at banks available today.

The promo CD rates include a nine month certificate of deposit and a tweleve month certificate of deposit.

The current CD rate on both certificates is 1.49 percent with an annual percentage yield of 1.50 percent. The minimum opening deposit for both certificates is $500. The minimum deposit amount to earn the CD rate and CD yield is one penny.

Danversbank has been insured by the Federal Deposit Insurance Corporation (FDIC) since 1985. The bank’s FDIC Cert # is 90185.

FirstFedDirect the online banking division of First Federal Bank of California is offering some of the best CD rates available. Right now, FirstFederalDirect is offering one of the highest CD rates available for a six month certificate of deposit.

The annual percentage yield on their six month CD is at 1.75 percent. The minimum opening deposit for the certificate of deposit account is $10,000. The maximum amount is $1 million. Of course the maximum amount of deposit insurance provided by the Federal Deposit Insurance Corporation is $250,00 until 2014.

FirstFedDirect also is offering a certificate of deposit ladder, or CD ladder. CD laddering is a way to maximize your returns. When using the stragey of CD laddering you open multiple CD accounts, each has a different term and maturity date. Doing this staggers the date that the certificates mature. As each certificate matures, you re-invest it back into the longest term on your ladder.

Eventually you will have all your certicate of deposits earning the highest yield because the certificates will all be in the longest period in your CD ladder but you will have certificates maturing more frequently so you’ll have access to your money if you need it, if you don’t you just keep the ladder going.

Wilshire State Bank CD rates are some of the highest CD rates available these days. As of today, the rate on their three month certificate of deposit is currently at 1.49 percent with an annual percentage yield of 1.51 percent.

Well above the national average certificate of deposit rates available. The minimum opening balance is $1,000 and the minimum balance to earn the APY is $1,000.

Wilshire State Bank of Los Angeles, California, has been around since 1980 and has branch locations in California, Texas, New Jerseyand New York. Certificate of deposit accounts can be opened on line at wilshirebank.com.

You can choose to have the interest you earned credited to your account monthly, quarterly, semi-annually,  annually, or at maturity (if one year or less. The more frequent interest is credited the higher your over all APY will be. That being said, we recommend always selecting the shortest period for having interest created to your certificate of deposit account.

Saving rates are different for different banks. So in order to find the best savings account rate you need to do a lot of research. You should compare savings rates of all the banks.

There are many websites which provide you such information. By saving rate I mean the interest rates offered by banks on your saving accounts.

For the past year or so savings account interest rates have been going lower and lower. So like many people I spend my money instead of saving it at a bank, maybe if I was given a decent savings account rate I would save more of my money. I get my salary and then in few days all is spent.

So I hardly have more than $50 in my savings account at anytime. You can say I live paycheck by paycheck. I love to spend money, so for me the savings rate that is being paid by banks doesn’t really matter right now. Maybe when I’m older when I have kids I’ll start to save more.

If you do save a portion of your money you should shop for the best saving rates. There are saving rates calculators which help you to calculate the savings rates. My advice to people  is that look for high yield savings account and then deposit your money for the purpose of saving, don’t be irresponsible me, be mature.

Credit cards are a part of our lives today.  Few days ago, I was talking to my friends about gas credit cards.  I asked them whether or not getting a gas credit card will help save money on gas costs. What I learned from them is that there are gas stations offering credit cards which give you rebates on gasoline purchases.

Since gas prices are very high nowadays these credit cards are becoming more and more popular.  If you fill purchase gas from a particular company gas station each time like Mobil, Chevron or any other gas station company, then it is better if you apply for gas credit card of that company.You get a discount on your purchases or cash back for purchasing gas using your gas credit card. Sometimes these companies also offer contests and sweepstakes where you can win free gas for a year or some other offer.

Gas credit cards are a good thing when used wisele, but as always you should be very careful before taking a new credit card. You should compare gas credit cards from several different credit card companies.  You must also check the credit card interest rate before applying for credit card.

Since credit card interest rates are so high these days you will want to pay off your gasoline credit card every month otherwise the cash back or credit card rewards you get won’t even cover what you’re paying in interest to the credit card company. When applying for gas credit cards be cautious and read all the terms and conditions of the card you are applying for so you can make the best choice when choosing a gas credit card.

How much car insurance you pay is a very important consideration for anyone before buying a new car. I was thinking of buying a new car but my friend advised against it.

He said if you buy a new car you need to take a auto loan and you will have to pay higher auto insurance premiums because the car will be financed by a bank.

Car insurance rates for a new car are much higher than a used one. So he told me it was better if I bought a used car. One should compare auto insurance quotes of different companies and then see what is best for them. After researching and comparing auto insurance rates you should choose the auto insurance company that gives you the best insurance rate for your money.

There are some sites which provide online car insurance quotes.  Having auto insurance is a must if you want to register your car in the state you live in. When I was looking for an insurance company my brother helped me with it and told us about the insurance company he was using and said it was good one.

He worked out everything for my auto insurance.  Another thing is that the auto insurance rates  you pay will become higher and higher if you have and accident, so always drive safely and be a defensive smart driver.

Dispersing your savings across many banks will help protect you if one of the banks you have a savings account with fails.

The Federal Deposit Insurance Corporation (FDIC) insures all deposit accounts like savings accounts, checking accounts and certificate of deposit accounts up to $250,000. Having multiple accounts with different banks will protect you from losing any of your deposits.

When I was a new member of the group I was really amused by this idea. I asked one day “why?” My friends asked me what I meant by why. I asked them why it is better to have a savings account in more than one bank. They stared at me incredulously and answered my question.

They told me that it is better to have more savings accounts because you cannot put your trust on one bank. Anything can happen. In present economy you never know when any bank will be out of business. They can file for bankruptcy.

So, it is better not to keep all your eggs in one basket. I listened to them and understood their point of view, but I asked them if they were so worried about banks being closed then what is the need of keeping our money in banks and risking it, we can keep it in our homes.

They said if they will keep it in home, they will spend it. So, if they really wanted to save it, they should keep it away from them in banks. I said, “I got it”, but in reality I didn’t. 

Mortgage rates were up this morning after the unemployment rate came out and was actually lower, most economists believed the rate would go higher. The Bureau of Labor Statistics announced the unemployment rate went down to 9.4 percent in July, a decreased from the 9.5 percent  rate in June.

Because of the improved outlook on the economy and possibly the better unemployment rate banks are now offering fixed-rate 30-year mortgages above 5.50 percent, up from rates of around 5.20 percent in the beginning of this week. Which isn’t much higher than low home mortgage rates set a month ago of around 5.00 percent.

Mortgage rates will still be in this current range for the near future since inflation isn’t really a threat and the high unemployment rate will keep wage prices down, keeping inflation down. The Obama Administration also realizes the housing market is still in a depression so they will do all they can to keep mortgage rates low for the foreseeable future. The unemployment rate had been expected to go up to 9.8 percent last month.

Mortgage refinance rates have been moving up recently. The beginning of this week we saw conforming 30 year mortgage rates almost approaching 5.50 percent. The recent rise in mortgage rates has put a damper on the refi market that had been humming along until recently.

U.S Treasury yields were up this week because the ecomonic outlook is starting to look a lot better than previously thought. As a result mortgage rates moved from around 5.00 percent up to 5.50 percent.

Thinking about refinancing your existing mortgage or getting a new mortgage for a home purchase? You probably should go ahead and do it because mortgage rates will be headed higher. Waiting until later this year or next year will cost you more, you should go ahead an lock into current mortgage rates now.

Mortgage interest rates are probably headed towards 7.00 percent by the end of 2010. Right now you can find mortgage lenders with mortgage rates in the 5.00 percent to 5.50 percent area. So if you’re on the fence about getting a mortgage go ahead and do it while mortgage rates are low.

Current mortgage rates have been hovering around the 5.00 percent to 5.50 percent range, although trends are showing the direction of interest rates is probably up since we care coming out of the economic recession.

Mortgage rates will probably head above the current range because 10-year U.S. Treasury prices have been heading up towards 4.00 percent, that will drive 30-year fixed mortgage rates higher. Maybe towards the 6.00 percent to 7.00 percent range. 

U.S Treasury rates were up considerably this  past week which drove mortgage rates higher.  Mortgage rates have gone up from the 5.00 percent range to 5.50 percent this week. Mortgage loan rates have been driven higher by the increase in Treasury prices, from around 3.50 percent towards the 4.00 percent range.

Let’s see if mortgage rates and 10-year Treasury prices increase next week or decrease, the unemployment numbers weren’t as bad as expected so interest rates might be headed higher. The way mortgage rates have been headed in one direction one week than another direction the following week, who knows what to expect in the coming week.

If you’re thinking about getting a mortgage or refinancing an existing mortgage I would start right away, eventually these low mortgage rates will disappear!

Mortgage rates currently are right above 5.00 percent. Mortgage rates haven’t changed much the past month.

In a survey released yesterday by Freddie Mac, called the Primary Mortgage Market Survey, it shows 30-year mortgage rates at 5.22 percent, down by 0.3 percent over the prior week’s average mortgage rate.

Only conforming mortgages are reported in the survey, Freddie Mac’s survey doesn’t include jumbo mortgage rates.

Mortgage Rates Current

The average conforming mortgage rate on a 30-year mortgage is at 5.22 percent with an average points of 0.6 for the week that ended on August 6, 2009.  The mortgage rate is down from the last week’s average 30-year mortgage rate of 5.25 percent .

Average rates on a conforming 15-year mortgage was down to 4.63 percent this week, with an average points of 0.6, down from the prior week’s average 15-year conforming mortgage rate of 4.69 percent.

Adjustable Rate Mortgages

Adjustable mortgage rates were also down the week that ended on August 6, 2009. The average mortgage rate on a one-year adjustable is currently at 4.78 percent with an average 0.5 points, down from the previous week’s average one-year home loan rate of 4.80 percent.

The average five-year adjustable mortgage loan rates is at 4.73 percent with average points of 0.6 for the weekending August 6, 2009. Down from the last week’s average mortgage interest rate of 4.75 percent.

Quantum National Bank, a small bank in Suwanee Georgia, which is a suburb of Atlanta has one of the best CD rates today for a 12-month certificate of deposit.

As of today, the CD rate is currently at 2.48 percent, with an annual percentage yield of 2.50 percent. The minimum opening deposit for this CD account is $1,000.

This certificate of deposit is limited to residents of the state of Georgia right now. You can open other types of accounts at Quantum National Bank like a money market account or Individual Retirement Account (IRA) if you don’t live in Georgia. 

The money market account rate is at 2.00 percent with an annual percentage yield (APY) of 2.02 percent for account balances over $100,000. The minimum opening deposit is $100. You have to maintain a minimum average daily balance of at least $1,500, if you don’t there is a monthly account fee of $12. The money market account also give you check writing privileges.

The latest economic data released by the US government is a mixed bag of good news and bad news. The bad news is, the service sector performance continue to decline. The services index went down to 46.4 from 47 in the month of June.

The service sector accounts for about 80 percent of the US economic activity. The experts explained that this trend is related to the never-ending job losses that just continues to go up. The might be further aggravated by the latest labor data which will be released this Friday. Unemployment rate is a big issue as more job losses means people have less cash available for spending.

But even of this is the case, news from the housing market and manufacturing sector flashes a different signal. The housing market made a good rally this summer showing consecutive increases in home sales which is attributed to cheap prices and low mortgage rates.

The manufacturing sector also  continued its increase for the fourth time in five months span. The Commerce Department reported last week that factory orders went up by 0.4 percent following a whooping 1.1 percent increase in the month of May. Economic experts are expecting a decline but were surprised by the continued increase which bolster claims of the economy is recovering strongly.

Auto loans are necessary if you are planning to buy a new car. My friend was planning to buy a new car he told me that he was thinking of taking an auto loan.  I told him that all the car dealers have connection with banks which can provide the auto loan.

What auto loan interest rate is offered by them, my friend asked? I was not sure so I said that it is easy, there are auto loan calculators on the website of car companies from there one can calculate the auto loan rate.

He was too excited so we browsed the websites of different car companies and there he calculated his monthly interest rate. I told him that interest rates depend on the credit score also; if you have a good credit score you will get lower auto loan interest rate. He asked me if there was any online auto loan, I had no idea so I asked him to check it out.

Buying a new car is a head-ache you have lot to worry about auto loans, auto loan interest rates, auto insurance and then you have to pay a lot of money upfront. My friend is ready for such head-ache and I know he will figure out all these things soon and will buy a new car soon

Managing your personal finances is difficult at times so I started looking for personal finance software to help. There are lots of personal finance software available and it is difficult to come to a decision on the best one for my needs.

With so many credit cards, debit cards and bank accounts it is difficult for me to manage my expenditures. I am always worried I will spend more than what I can pay if I keep on going without keeping track of my money. I want to pay my insurance premiums on time. I do not want to have any debt on me because of my late payments.

I want to find finance software that will be like a personal finance manager. Who can tell me how much I spent, how much I owe. I also want to know the rates of my stocks and how well or badly my stocks are doing. I went to my friend and she showed me a personal finance magazine which was really interesting.

The magazine was Money Magazine. Reading the magazine opened my mind and helped me to know that I am not the only one in this world who is having such problems in managing personal finance. It’s not that I don’t know anything about finances, but it’s the lack of time which makes things more complicated. Now I have decided on a great personal finance software which I will start using it right away.

“I need a credit card”, I told my friend.  He said that I already had a credit card then why I needed a new credit card.  I told him that the credit limit on my current credit card was very low. I downloaded a credit card application from the bank’s website and filled the application but didn’t submit it.

You must be thinking why I didn’t submit the application. The reason is my bad credit history. I told this to my friend and he told me that he had heard about bad credit credit cards.  There are many companies which offer credit cards irrespective of your credit history.

If you have no credit or bad credit then you should not worry as they will take care of it. I told him but I want a credit card with no annual fee, will these companies give me no annual fees credit card. He said he will ask about it from some of his friends.

I am not sure I will be able to have a credit which charges annual fee as they are very expensive and I already have a credit card with no annual fee, I can ask the credit card company to increase the limit instead of applying for a new credit card. May be they will not increase the limit, but at least I should try.

“Reverse mortgages are good for people like me”, my dad was telling me yesterday. I was clueless as to what a reverse mortgage is so I asked him about it. He told me it’s simple. Firstly it is for senior citizens,  it allows you to convert part of the equity in your home into cash without having to sell your home or pay additional monthly bills.

How much money you receive monthly is determined by how much your home is worth, how much equity you have in your home and what the current mortgage rates are.

With a traditional mortgage we make payments to the bank but in reverse mortgage bank pay the homeowner money every month and you can live in your home. When a person dies or sells his home, the loan is repaid. It is a good option for people who are above 62, have a home but do not have enough money to live their lives happily.

They have no money to pay bills for health care, medicines, groceries etc. This option can get them cash to spend as long as they live and they do not have to leave their houses.

I think it is a reverse mortgage is a good type of mortgage product for older people. It is becoming very popular across the United States. Its like a savings account, you can withdraw money every month and your money is safe and will be there for you as long as you live.

Savings means setting aside our hard earned money for future requirements.  There are different ways of saving money. We can save the money in a bank that paids interest.

Also we can save money by reducing our expenditures. We can reduce unnecessary costs and save money. We can deposit the money into a deposit account in a bank or investment in shares where the risk is higher.

You can walk into a local bank and open a savings account but you probably will receive a better savings rate if you open an online savings account. You can find rates a lot higher online with high yield savings accounts.

There is a difference between “saving” and “savings”. Saving means an increase of one’s assets and savings refers to one part of one’s assets for example deposits in savings accounts.

When you want to open a bank account, which bank would you choose? The correct selection of a bank depends on our needs and circumstances. Naturally every one likes to choose a bank that offers highest savings interest rate. But how to know which bank offers highest interest rates? There is a way called “Savings Accounts Interest Rate Score Card”. This card lists some of the leadings banks which offer high interest rates on savings accounts. Online bank account also offers high interest rates.

One more best way to select a bank is to select a bank that offers an FDIC insured account in which we will not lose money even the bank runs into losses.

Now let us see what a savings account is. Savings accounts give us free and easy access to our money. We can withdraw our money any time if it is invested in a Savings account.

Savings Account rates, certificate of deposit accounts and mortgage rates have been coming down the past year because the economy is contracting and there are government programs that are designed to get the economy going by lowering rates.

The U.S. Treasury Department has also been lending billions of dollars to  large and small financial instituions with the Troubled Asset Relief Program (TARP).

Interest rates are lower because of TARP.  Savings rates have been going down because institutions a cheaper source of funds from which they can borrow from. There has been less promotional deposit offers from banks because they have less of a need for deposit funds.

The Federal Reserve has also been forcing interest rates down.  The Fed has kept the Fed Funds rate at a target range of 0 percent to .25 percent since the fourth quarter of 2008 to get the credit markets and the economy going again.

The Feds have also been printing money to buy large quantities of mortgage backed securities to drive mortgage rates down.  Lower mortgage rates also mean lower interest rates on deposits.

Rates on savings accounts will stay low until the Feds start raising interest rates which will probably happen in early 2010. When the economy starts to recover the Feds will have to start raising the Fed Funds rate to keep a lid on inflation. This is will drive rates on savings accounts higher.

The Federal Deposit Insurance Corporation (FDIC) has raised the limits on all deposit accounts, including checking and savings accounts, money market deposit accounts and certificates of deposit (CDs).

The old limit was $100,000. The new limit is now $250,000 until January 1st, 2014.

The new temporary limits are:

• Single Accounts (owned by one person) $250,000 per owner 
• Joint Accounts (two or more persons) $250,000 per co-owner 
• IRAs and certain other retirement accounts $250,000 per owner 
• Trust Accounts $250,000 per owner per beneficiary subject to specific limitations and requirements 
• Corporation, Partnership and Unincorporated Association Accounts $250,000 per corporation, partnership or unincorporated association
• Employee Benefit Plan Accounts $250,000 for the non-contingent, ascertainable interest of each participant 
• Government Accounts $250,000 per official custodian

On January 1, 2014, the standard coverage limit will return to $100,000 for all deposit categories except IRAs and Certain Retirement Accounts, which will continue to be insured up to $250,000 per owner.

An investment in a certificate of deposits is risk-free and can be cashed in at any time. Certificate of Deposits are time deposit accounts with a bank, a thrift, credit union or some other type of financial institution. CD rates are higher than traditional savings account rates because your money is locked up in a timed deposit. Finding the best CD rates online these days is easy with comparision shopping sites.

Certificate of Deposit

Bank certificate of deposits and other savings deposits are also federally insured by the Federal Deposit Insurance Corporation for up to $250,000. A certain dollar amount is invested and your money is also invested for a fixed amount of time, usually one month to five years but some banks offer CDs with a longer period of time.

For lending the bank your money, you are paid interest at regular periods. Usually, the longer the certifcate maturity date, the higher the CD rate you receive. Cashing in your certificate of deposit before it matures will cost you an early withdrawal penalty, usually 3 months of interest but the penalty can be as much as one year’s worth of interest on longer term certificates.

With a brokered certificate of deposit you will have to try to sell it in an open market which won’t guarantee you get the price you paid. Therefore, it is best to be sure you don’t need access to the money before the certificate matures.

Certificate of Deposits have become more complicated these days, you can now invest in variable rate CDs, jumbo CDs and long term CDs. Banks can sometimes also call a certificate, meaning the bank may choose to terminate the CD if interest rates fall and you have locked in a higher rate, so also be sure to find out if your certificate is callable. Find out if there are any early withdrawal penalties or if you have to forfeit all of the interest you earned.

Certificate of deposit laddering or CD laddering is a way of investing in certificate of deposits usually when CD rates are rising.  The statergy is used when the economy is expanding and the Federal Reserve Bank is raising interest rates to prevent inflation. Bank will raise rates on certificate of deposits and online savings accounts.

Longer term certificate of deposits have higher interest rates and annual percentage yields, unless the yield curve is inverted, when shorter term CD rates are higher than longer term CD rates. If you have deposits locked up in  longer CD terms your returns will be lower than can be when interest rates are raising.  The best way to avoid this from happening is by laddering your CDs.

How Does CD Laddering Work?

Certificate of deposit laddering is a process of evenly spreading out your funds in several different CD terms over the period of several years. In the end, your money will be deposited in longer term certificate of deposits. Longer term certificates pay a higher rate of return and you still have a certificate that matures every year giving you access to your money without an early withdrawal penalty.

Example of a CD Laddering

We will use a three year strategy with $30,000 for this example. The CD investor deposits $10,000 in a 3 year CD, $10,000 in a 2 year CD and $10,000 in a 1 year CD.

After year one, the 1 year $10,000 CD matures, the CD investor then invests the money in a 3 year CD. After year two, the 2 year $10,000 CD matures, the CD investor invests in another 3 year CD. After two years all the monies are invested in 3 year CDs at a higher interest rate, again, this only works  in a rising interest rate economic environment.