E-Loan Bank CDs

Written by BankWriter 1 Comment Updated: April 28, 2011

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E-Loan Cd accounts test results

Their motto is “radically simple”, but how about E-Loan services and fees on their best cd accounts. The ease of opening an online cd account is definitely a factor in finding the best cd account, but it isn’t everything. Let’ see what else is note worthy about E-Loan cd accounts.

Pre-Test for E-Loan cds

Before using online banking services and opening a new deposit account, I always want to make sure that the account is FDIC insured. That way I know that I am protected against bank failure as an investor. All deposit accounts opened at E-Loan Bank are FDIC insured and they are actually opened through Banco Popular North America which is the parent company of E-Loan. Another component for my pre-test is if they have any fees. There appear to be no fees associated with E-Loan cd accounts other than the standard early withdrawal penalty. The last part of my pre-test is to look at what the minimum opening balance requirement is for these high yield CD accounts. The news here isn’t so great. The minimum opening account deposit for E-Loan CD’s is $10,000. There are many online banks like Ally Bank and Sallie Mae Bank who do not have minimum opening deposit requirements for high interest cds. So far E-loan has scored only two out of three.

Post test

The post test for any high interest Cd account includes two items: What terms are available and how do their interest rates compare with other banks. The terms available for certificates of deposit from E-Loan are varied which is a great plus. They even have a 1 month cd which is a little harder to find. The longest term available is 6 years. For a great over view of rates offered and how a higher balance on deposit does not help you earn a better rate please see the chart below.

Certificates of Deposit

	$10,000 – $49,999.99		$50,000 – $99,999.99		$100,000 – Greater
Product Term	Rate	APY*	Rate	APY*	Rate	APY*
1 Month CD	0.15%	0.15%	0.15%	0.15%	0.15%	0.15%
2 Month CD	0.20%	0.20%	0.20%	0.20%	0.20%	0.20%
3 Month CD	0.25%	0.25%	0.25%	0.25%	0.25%	0.25%
6 Month CD	0.30%	0.30%	0.30%	0.30%	0.30%	0.30%
9 Month CD	0.40%	0.40%	0.40%	0.40%	0.40%	0.40%
1 Year CD	0.50%	0.50%	0.50%	0.50%	0.50%	0.50%
18 Month CD	0.75%	0.75%	0.75%	0.75%	0.75%	0.75%
2 Year CD	1.00%	1.00%	1.00%	1.00%	1.00%	1.00%
3 Year CD	1.14%	1.15%	1.14%	1.15%	1.14%	1.15%
4 Year CD	1.34%	1.35%	1.34%	1.35%	1.34%	1.35%
5 Year CD	1.88%	1.90%	1.88%	1.90%	1.88%	1.90%
6 Year CD	1.98%	2.00%	1.98%	2.00%	1.98%	2.00%

Please note that these APY rates assume that you will keep the principle and the interest on deposit until maturity. As you can see it is term length that influences rate not deposit amount. The APY rate of 0.25% for a 3 month certificate of deposit is not the best cd rate out there. It is above the national average but really is in the mid to low range. Goldwater Bank cds offer almost twice the rate of return with the same initial deposit requirement. Discover Bank offers a larger return than E-Loan with an initial deposit of only $2,500. If you are looking at a year rate Aurora Bank offers a rate of 1.24% APY with only $1,000 required as an initial deposit. As you can see when it comes to the post test it is a 50 50 split… great variety in terms but not the best rates.

Summary of E-Loan CD accounts

When we add up the result of the pre and post tests, E-loan scores 3 out of 5 times on the key factors in finding the best cd account. When I am weighing the scores there are some things that count a little more than others. As you can see from Bank Truths Best CD Rates page, there are a large number of FDIC-insured cd accounts to choose from, so although that is a very important factor, it is one that is easy to find. It is much harder to find a truly high rate cd account. The high deposit requirement may make the score of E-Loan certificates of deposits a non issue for the beginning investor. If you cannot amass the initial deposit then why worry about the rest. E-Loan is a moderate choice. They offer no fees, easy application cds with rates that are better than the national average but not the best cd rates out there. If you would like to learn more about E-Loan, please see Banks Truths review.