Aurora Bank Certificates of Deposit

What can you find at Aurora Bank in terms of CDs? This post will work to answer that question to help you determine whether an Aurora Bank CD account is the best cd account for you. Please consider this an investment investigation.

What do I need to get started?

In order to open a high yield cd account with Aurora Bank, first you need the initial deposit amount of $1,000. If this amount exceeds what you have currently available, do not despair, there are banks like Ally Bank and Sallie Mae Bank which have no minimum deposit requirements.  If you have the funds available, then all you need is your computer with internet access and basic personal information to apply for a high interest cd account. The application only takes about ten minutes to fill out. Online Banking is great isn’t it!

What are the terms available for CDs at Aurora Bank

Aurora Bank has several terms available. The shortest term is 6 months and the longest term is 5 years. Remember this is a high rate CD account and so choose your term with care. Should the situation arise where you do have to make a withdrawal, there will be a penalty. If your original term agreement was less than one year, you will be zinged a fee that will equal 3 months of interest. A term of a year or more has a penalty of 6 months of interest. Can you see how if you are not careful, the penalty could result in the loss of principal? Think of opening a 1 year high yield cd and having to make a withdrawal after only 3 months. Ouch, you just lost all your interest earned to date plus an equal amount of principle as well. This situation is one of the cons of a cd account. Are you unsure of the pros and cons of cd accounts? Bank Truth has a page outlining the positives and the negatives of cd accounts in general.

How much interest will I earn with an online cd account from Aurora Bank?

The APY rate for high rate cd accounts at Aurora Bank are tied to two things the length of the term you select and the amount of your deposit. Now these two factors are definitely not equal in their influence over the APY rate. For a CD account at Aurora Bank, term is king! If you deposit over $100,000, you do earn a slightly higher APY rate but it really is not much to speak of . The higher rate is only an increase of .01 or .02% APY. For this reason I would not say that these high rate cd accounts are tiered.

Comparing rates is the fun part of any deposit account investigation so here we go. Please see the chart below.

CD Rates by Terms & Deposit Amount

(As at 20 Sept 2010)

(As at 7 June 2011)

As you can see, the highest cd rate is achieved by selecting a 60 month (5 Year) cd and depositing $100,000. Also note that the rate is only .02% higher than if you had deposited only $1,000. In comparison to other high rate cds,  Aurora Bank has one of the best rates in the nation for 1 year certificate of deposit. They are in the top ten for 5 year cds and in all cases are above the national average. Do not get carried away by the higher rates. The best term for you, is the one that works with your goals and financial situation. Remember the early withdrawal penalties that we discussed earlier. If you would like to do some more rate comparisons please see our cd rate charts.

Various and As-sundry Details not Previously Discussed

When I investigate accounts I like to find out as many of the details as I can no matter how many clicks it takes me. Aurora has a fairly well laid out website where I was able to find several tidbits that may or may not matter to you. Cd accounts do renew automatically and Aurora will notify you about 30 days prior to the renewal date. If you do not do anything your account will renew for the same term as previously selected with the rate that is currently being offered on the renewal date. You do have a seven day grace period, where even if the account renews, you can still withdraw your funds and close the account.

You can elect to have the interest that you earn withdrawn from the account regularly but, that will reduce your APY rate. You must select this option in the beginning if you want it.

Please note that you may not make any deposits to the account after you open it. These accounts are also available in a traditional IRA or a Roth IRA.

Summary of Aurora Bank cd accounts

Now that you have all the facts, let’s try to summarize what the investigation has found. Aurora Bank does have high interest cd accounts that compete well with those offered by other Banks like Ally Bank, Discover Bank, or Bank of Internet. It does not have the highest rate but it is among the top rates offered nationally. The early withdrawal fees are average; Nothing really, to write home about in the area of fees.  Aurora Banks penalties are not exorbitant, but not low either.  Since the APY rate is mostly tied to term, I would say that Aurora caters to investors with lower deposit amounts. There really is not an incentive for depositing large amounts.

If you would like to know more about Aurora bank please see our full bank review as well as our posts on Aurora Savings and Aurora Money Market accounts.