August 29, 2017 in Banking
CIT Bank

You don’t need deep pockets to qualify for some of the nation’s best CD deals.

Case in point: CIT Bank’s 11-month, no-penalty CD. With a $1,000 minimum deposit you can earn 1.55 percent APY. That’s one-tenth of a percentage point higher than the CD’s previous yield.

The offer is similar to a deal at Ally Bank.

Ally’s no-penalty CD also has an 11-month term. But you’ll need $25,000 to snag the top interest rate (1.6 percent APY). To earn 1.35 percent APY, you would have to deposit at least $5,000.

Bethpage Federal Credit Union has an 11-month no-penalty CD, too. The minimum deposit is lower ($50), but so is the yield (1.5 percent APY).

Compare CIT Bank’s promotion to other top CD offers. Then calculate the amount of interest you could potentially earn.

Why you’ll want a no-penalty CD

What’s most appealing about no-penalty CDs is the lack of an early withdrawal penalty. After a brief period (often six days after funding an account), you can grab the money in your CD at any time with no strings attached.

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With a traditional CD, you’ll lose part of your interest (and possibly part of your initial deposit) for tapping into your CD before it matures.

The downside to no-penalty CDs? You’re typically stuck with a lower interest rate.

The top 12-month traditional CDs pay at least 16 basis points more than CIT Bank’s 11-month CD. A basis point is one-hundredth of a percentage point.

Top nationally available 12-month CD rates
Institution APY Minimum deposit
Crestmark Bank 1.80% $25,000
ableBanking 1.75% $1,000
Banesco USA 1.75% $1,500
CDBank.com 1.75% $10,000
IncredibleBank 1.72% $1,000

On the bright side, CIT Bank’s no-penalty CD pays a higher yield than a standard savings account.

How to buy CIT Bank CDs

CIT Bank CDs can only be purchased online. To buy one, you must:

  • Be at least 18 years old
  • Be a U.S. citizen or resident alien
  • Have a Social Security number
  • Have a driver’s license or valid state ID

There are several options for funding your CD. You can transfer money electronically from another checking or savings account, mail a check or request a wire transfer.

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Terms and conditions

With CIT Bank’s no-penalty CD, know that you can’t partially withdraw your initial deposit. When you’re ready to withdraw your principal, you’ll have to close your account. You can, however, withdraw part of your interest at any time.

Interest compounds daily and is credited monthly. Each month, you’ll have the option of transferring interest electronically to a bank account or having a check mailed to your home.

When your no-penalty CD comes due, you can close it or let the CD automatically renew following a 10-day grace period.

About CIT Bank

CIT Bank is an online-only financial institution based in Pasadena, California. It’s a subsidiary of CIT, a financial services company established in 1908.

The bank earned five out of five stars on Bankrate’s latest review of its financial health.

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