Frequently Asked Questions: CDs

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Common Questions about CDs

CDs are similar to savings accounts, but they are set to a fixed term (usually ranging from one month to ten years) and a fixed interest rate. It is expected that a CD be held to the end of the term, at which time the money may be withdrawn with the accrued interest. Early withdrawals of the principal balance may result in a fee, so ensure you will not need access to these funds for the term of the account before opening your CD.

Annual Percentage Yield (APY) expresses an annual rate of return taking into account the effect of compounding.

An interest rate is the rate at which a financial institution agrees to pay you back for holding your money.

Compound interest is the concept of adding accumulated interest back to the principal, so that interest is earned on interest from that moment on.

No, once your CD account is opened you cannot add additional funds to the account. After your CD account reaches maturity, you will have a 10-day grace period where you can add additional funds to your renewing CD account.

If you withdraw the principal balance from your CD prior to maturity, you will be charged an early withdrawal penalty based on the term of your CD account.

The applicable early withdrawal penalties are as follows:

  • Short-term CD (Less than one year) - 90 days interest on withdrawal amount, or half the remaining interest to be earned, whichever is greater. Plus a Transaction Penalty - $50
  • Long-term CD (one year or longer) - 180 days interest on withdrawn amount, or half the remaining interest to be earned, whichever is greater. Plus a Transaction Penalty - $50
You can withdraw interest credited to your CD account before the maturity of the term of your CD without bank penalty.

We will provide you with a CD Maturity notice 35 days prior to your CD account’s maturity date. The maturity date is the last day of your CD account’s term. There is a 10-day grace period that begins the day after your maturity date. During this 10-day grace period you have the following options:

  • Renew your CD with the same term or a different term (if renewing you can add additional funds);
  • Request a partial withdrawal of funds from your account without penalty; or
  • Close your CD by withdrawing all of the funds from your account without penalty

The CD Maturity Date can be located on the Account Details tab within Online Banking, by clicking the Show Account Info link within mobile banking, and on your quarterly CD statements – both electronic and paper versions.

If you take no action during your 10-day grace period, your CD will automatically renew for another term. Each renewal term will be the same as the original term, beginning on the maturity date.

For example, if you had an existing 8-month CD and took no action during the grace period, the CD account would roll into another 8-month term. The interest rate applied will be based on what is presently offered and may differ from the prior term. The new maturity date would be set based on the renewal date.

Changes to the term or interest rate can only be done during the 10-calendar day grace period (after the CD maturity date). Any request to change the term and/or interest rate outside of the grace period is considered breaking the CD and Early Withdrawal and Transaction penalties may be assessed. In certain circumstances, such as death or declared legal incompetence of a CD account holder, the law permits, and in some cases requires, the waiver of the early withdrawal penalty.

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