Archives for April 2009

Mortgage rates on 5-year adjustable rate mortgages (ARMs) reached another low this week. Mortgage rates on five-year ARMs were 4.80 percent with an average 0.6 point, down from last week when rates were 4.85 percent.

One-year ARMs averaged 4.77 percent with an average 0.7 point, down from last week when the average rates 4.85 percent. 

30-year fixed mortgage rates tied a record low of 4.78 percent with an average 0.7 point, down from 4.80 percent. 15-year fixed mortgage rates remained under 4.50 percent for the third straight week at 4.48 percent with an average 0.7 point.

Record low mortgage rates are helping to put a bottom in the housing recession. Housing prices have increased 0.7 percent in February 2009 compared to prices in January 2009.  Year over year prices have still declined 6.5 percent.  Read more: home sales

Frank Nothaft, Freddie Mac vice president and chief economist said “The housing market may be edging towards a bottom. Existing home sales stayed near its four-month average in March while new home sales were stronger than the market consensus. More importantly, the inventory of unsold new homes fell to the lowest number since January 2002. And, the S&P/Case-Shiller® 20-city composite index did not show a record year-over-year decline in February for the first time since December 2006. Finally, housing affordability hit record highs in the first quarter of this year, according to figures from the National Association of Realtors, which date back to January 1971.”

The credit card reform bill is being voted on by the House of Representatives today. The Bill which was written to help protect credit hard holders from unscrupulous credit card practices will probably be passed by both the Houses and signed by President Obama.

Here are some of the new changes.

The credit card bill will  prohibit a creditor from increasing any annual percentage rate of interest (APR) applicable to the existing balance on an open end consumer credit card account unless specified conditions are met.

Allows a creditor to increase an APR on the existing credit card balance only if the increase is due solely to:

• A change in the index rate, most credit cards are tied to the prime rate 
• A promotional credit card interest rate expires
• A payment was not received during the 30-day grace period after the due date
• Failure to comply with a workout plan.

Prohibits any such APR increase from exceeding the APR applicable to the particular category of transactions on the day before the effective date of the workout plan.

Requires a 45-day advance notice of credit card account rate increases, except one resulting from a change in index

States that, with certain exceptions, written notice of an increase in any annual percentage rate of interest shall be effective at the end of the one-year period beginning when the account is opened.

Prohibits any significant contract change from taking effect unless the creditor provides a written notice fully describing the change at least 45 days before the change takes effect.

Prohibits the imposition of a fee on an outstanding credit card balance, at the end of a billing period, that is attributable only to interest accrued during the preceding billing period on an outstanding balance fully repaid during that preceding billing period.

Requires each periodic statement of account to provide the toll-free telephone number, Internet address, and website at which the payoff balance may be requested, including statements of account issued by a small issuer (of fewer than 50,000 credit cards).

Grants a consumer the right to reject a new credit card before the creditor notifies a consumer reporting agency of its corresponding account.

Sets forth special rules for accounts with promotional rate balances or deferred interest balances.

Prescribes payment allocations to be used if two or more different APRs apply to different portions of an outstanding balance on a credit card account.

Prohibits a creditor from denying a cardholder a specified payment grace period if the cardholder takes advantage of a promotional rate balance or deferred interest rate balance.

Requires creditors to send a periodic credit card statement of account to the consumer at least 21 calendar days before the due date for the next payment on the outstanding balance.

Prohibits a creditor from treating as a late payment the receipt of a periodic payment by mail as of the creditor’s next business day if the date established by the creditor as the payment due date is a day on which mail is either not delivered or is not accepted by the creditor for processing.

5/1 mortgage rates are at record lows these days. This past week, 5/1 mortgage rates averaged 4.85 percent, with an average 0.6 point, ( you pay points to buy down the mortgage rate) down from last week when it averaged 4.88 percent. A year ago, the 5/1 mortgage rates averaged 5.68 percent. With a 5/1 adjustable rate mortgage (ARM) the interest rate is fixed for the first 5 years then the rate adjusts every year after

Monthly payments on 5/1 adjustable rate mortgages may be less expensive initially but can increase substantially over the life of the mortgage. Many ARMs, including  5/1 ARMs have teaser rates which are relatively short initial fixed-rate periods, usually months or sometime up to a year. The teaser rate payment is so low some borrowers believe they can afford more house than they really can. After the low teaser rate period has ended, monthly mortgage payments can increase substantially, making the ARM unaffordable.

5/1 mortgage rates are so low right now because the economy is in a recession and the government as been lowering interest rates to stimulate demand for homes. Right now jumbo 5/1 adjustable rate mortgages are averaging around 4.5 percent. 30 year fixed rate jumbo mortgages are averaging around 6.25 percent. Almost two percentage points higher. If you’re in the market for a jumbo loan you might want to consider getting an adjustable rate mortgage and refinancing to a fixed rate mortgage at a later time when rates are lower.

1% mortgage rates? Yes, is the Treasury Department just announced the Second Lien Program which will help homeowners with their second mortgages.

The Second Lien Program is part of the Obama Administration’s Making Homes Affordable ( MHA) Program designed to help the housing market recover and keep people in their home who are facing foreclosure.

An estimated six million people are expected to face foreclosure over the next several years. 50% of those people facing foreclosure have second mortgages. Second mortgages sometimes make modifying or refinancing first mortgages more difficult, even preventing a change in first mortgage terms because the second lienholder objects to the modifications.

This program might help 1 million to 1.5 million home owners reduce their mortgage payments. The government, rather you the tax payer, will share the cost for this program along with lenders. The pay-for-success incentive used for the first mortgage modification programs will also be used for the Second Lien Program.

Servicers can be paid $500 up-front for a successful modification and then success payments of $250 per year for three years, as long as the modified first loan remains current.

Borrowers can receive success payments of up to $250 per year for as many as five years. These payments will be applied to pay down principal on the first mortgage, helping to build the borrower’s equity in the home

For amortizing loans (loans with monthly payments of interest and principal) the government will share the cost of reducing the interest rate on the second mortgage to 1 percent.

Afer five years, the interest rate on the second mortage will step up to the then current interest rate on the modified first mortgage, subject to the Interest Rate Cap on the first lien, set equal to the Freddie Mac Survey Rate.

For interest-only loans the government will share the cost of reducing the interest rate on the second mortgage to 2 percent.

Here is an example of how this program is designed to work from financialstability.gov.

In 2006: Family B took out an interest-only second mortgage with a balance of $60,000, an interest rate of 4.4%, and a term of 15 years.

Today: Family B has $60,000 remaining on their interest-only second mortgage because none of the principal was paid down.

Under the Second Lien Program: The interest rate on Family B’s interest-only second mortgage will be reduced to 2% for five years. This will reduce their annual interest payments by $1,440.

After those five years, Family B’s mortgage payment will adjust back up and the mortgage will amortize over a term equal to the longer of  the remaining term of the family’s modified first mortgage (e.g. 27 years if the first mortgage had a 30 year term at origination and was three years old at the time of modification) or  the originally scheduled amortization term of the second mortgage.

Do you have an adjustable rate mortgage (ARM) coming up? Now would be a good time to lock in a 30 year mortgage or 15 year mortgage at these historic low mortgage rates.  Adjustable rate mortgages are also low these days but you run the risk of having to refinance again at a later date when rates might not be as low anymore.

30 year fixed conforming mortgage rates are around 5 percent. You can also find mortgage rates under 5 percent at certain banks and lending institutions. 15 year mortgage rates can be had for under 4.5 percent, an even better lock if you can afford the extra mortgage principal payments each month.

If you are a homeowner who has good credit,  payed your mortgage on time but are not able to refinance to take advantage of today’s lower mortgage rates because the value of your home has decreased? Well you can still refinance into a fixed rate mortgage. The Making Home Affordable Refinance website (government site) will help borrowers whose loans are held by Fannie Mae for Freddie Mac to refinance into a more affordable mortgage.

You can refinance up to 105% of the value of your home. You mortgage payments must be current on your existing mortgage.

We have all seen the letters that come with our mortgage payment bill, “save tens of thousands”, “save $60,000, “pay your mortgage off 5 years early”. The offers are real but is it worth signing up for?

The answer is yes and no.

Basically, a biweekly mortgage payment is paying half of your monthly mortgage every two weeks. 

You are saving a ton of money over the life of a loan because you are making an one extra monthly payment every year when you pay your mortgage biweekly.  Instead of making 12 payments a year, with biweekly payments you are making 13 payments per year. Paying down your principal early is saving you a boat-load of mortgage interest payments.

Banks and mortgage companies have done an excellent job marketing biweekly mortgage payments and some charge hundreds of dollars to sign up.

Why pay for the privilege of paying your mortgage early?

You don’t!

Instead of signing up for these biweekly programs you can achieve the same results by making one extra mortgage payment annually. If you don’t have the money to make an extra mortgage payment at once, spread the extra payment thoughout 12 months by paying down a little extra principal each month. Banks make this process easy for you by providing an extra line on your monthly mortgage payment. Look for the line that usually is “extra principal payment”.

To figure out how much money you will save over the life of a loan use an excellerated mortgage payment calculator. You will be asked the mortgage amount, interest rate you are paying, length of the mortgage and how much additional money do you want to pay monthly. You will be pleaseantly surprised how much you can save over the life of a mortgage. Calculator

Capital One Auto Financing is offering some very competitive rates on auto loans.  Capital One offers auto loans for new auto loans, used auto loans and refinancing an existing auto loans.

Auto loan rates for new cars can have an annual percentage rate (APR) as low as 4.99%. Used auto loan rates are as low as 5.99% APR. Rates for refinancing an existing auto loan are as low as 5.15%.  Rates will vary depending on your credit history.

New auto loan rates are:

• As low as  4.99% APR for a 36 month auto loan
• As low as  5.09% APR for 48 month or 60 month car loans
• As low as  5.69% APR for 66 month or 72 month car loans

Used auto loan rates are:

• As low as 5.89% APR for a 36 month auto loan
• As low as 5.99% APR for 48 month or 60 month auto loans
• As low as 6.69% APR for 66 month or 72 month auto loans

Refinance rates on auto loans:

• As low as 5.15% APR for a 36 month auto loan
• As low as 5.15% APR for 48 or 60 month auto loans
• As low as 5.15% APR for 66 or 72 month auto loans

Capital One has some restrictions on the age, type and mileage on autos. Vehicles must be 7 years or newer and have less than 70,000 miles. They do not offer financing for commercial vehicles, motorcycles or recreational vehicles.

The auto must also be purchased from car manufacture authorized dealers, Carmax or the following major car rental agencies: Alamo, Avis, Budget, Dollar, Enterprise, Hertz, National, Payless and Thrifty. Capital One doesn’t offer financing for vehicles purchased private sellers, independent used car dealers or auto brokers.

A Home equity line of credit, also known as a  HELOC, a popular way of home owners to access equity in their home have come under assault recently by banks.

In recent past, banks and financial institutions were lining up giving out home equity lines of credit to everyone. Sometimes loaning more then the actual value of a home. In a market of rising home prices and the belief that home prices will never decline across the entire U.S banks lowered their lending standards. As we all know, banks along with everyone else was  dead wrong about home prices.

As a result, banks have been lowering the amount of available credit on HELOC’s and actually closing HELOC accounts when no money is owed. This practice has been widespread, not just limited to people with bad credit ratings or borrowers who are behind on their HELOC payments. Banks have also made it much more difficult to qualify for a HELOC.

Gone are the days of loaning up to 100 percent or more of the value of a home. Some banks require more you to have more equity in your home then the historical norm of an 80 percent loan-to-value ratio (LTV). Meaning the loans on your home, including your mortgage, cannot exceed 80 percent of the value of your home.  

A close friend of mine had his HELOC closed by JP Morgage Chase on a home he and his wife owned. They didn’t owe any money on the HELOC but the interesting part of this story is they didn’t owe any money on their home at all. No primary or secondary mortgage balance, they owned their home outright but Chase still closed their home equity line of credit.

Using a rewards credit card is a great way to earn points or cash when making purchases. There are tons of rewards credit cards available these days, many offer a 0% introductory rate for 6 months, some rewards credit cards have a 12 months 0% introductory rate. Some of the more popular reward credit cards include airline rewards credit cards and hotel rewards credit cards.

When you accumulate a certain number of points or cash on your rewards credit card you can use your credit towards free airline tickets, free hotel rooms or you can purchase retail gift cards to use for purchases.

Some of the more popular rewards credit cards include Discover Bank’s Miles credit card. With the Miles credit card you can earn 1 mile with every $1.00 purchase. You also earn double miles for your first $3,000 in restaurant and travel purchases every year. You earn 1000 bonus miles each month for up to 12 months as long as you make at least one purchase with your miles credit card every month. Your earned airline miles never expire. You can cash in your miles, use our miles for travel or towards retail gift cards. There is no annual fee for this credit card.

Your miles will be forfeited if you close your account, don’t make a purchase for 18 consecutive months or fail to make the minimum payment due by the due date for two consecutive billing periods.

The American Express Gold Rewards Credit Card is another popular card. You earn 2 points for every dollar spent on gas and groceries for the first year (valid on up to $1,000 of eligible gas and grocery purchases each month. If you make $500 in purchase the first three months you earn 10,000 bonus points. You can redeem your points with over 21 different airlines. No annual fee the first year then $125 annual fee each year after.

If you are late on a payment your points can be forfeited. Once you’re good on your account your points can be reinstated for a $29 fee. Your points will be forfeited if your account is closed for any reason. There is a “Points Advance” program where you can get up to 15,000 points in advance. You can also purchase points in 1,000-point increments for $25.

MonitorBankRates.com has been alerted of a Chase Bank/Washington Mutual checking account promotional offer by some of our readers. WaMu will give you $100 for opening a checking account. The minimum deposit is $500. To receive this promo checking account offer you must have a unique promotional code which is being sent out in mailings. The checking account can be opened at a branch location or online.

Darby Direct, an online division of Darby Bank headquartered in Vidalia, Georgia, is offering an online savings account that currently has an annual percentage yield (APY) of 3.00 percent.

Looks like the rate hasn’t changed in a while, which is unusual because banks have been lowering rates frequently. The 3.00% APY is as of November 1st 2008. The minimum opening deposit is only $1.00 and the online savings account application process only takes 10 minutes. You will need to provide the following information to open an online savings account.

• Driver’s license or a passport
• U. S. social security number
• U. S. citizenship or resident alien status
• Account numbers for accounts that you plan to transfer funds to your new Darby Online Savings Account

The online savings account is offered by Darby Bank & Trust Co. Deposit accounts are insured by the FDIC.Darby Bank & Trust Co’s FDIC Cert is 14580.

eBank of Atlanta, Georgia is offering some of the best CD rates available today. eBank is a federal savings bank that provides a full range of banking products including mortgages, deposit accounts and financial products. Deposits at eBank are insured by the Federal Deposit Insurance Corporation(FDIC). eBank’s FDIC cert is 34682.

eBank’s CD rates are well above the national average for most certificate of deposit terms. As of April 26, 2009, eBank’s 3 months CD rate is 1.78 percent whereas the national average for 3 months CD rates are 0.925 percent. eBank’s 6 months CD rate is 2.30 percent, the national average for 6 month CD rates is 1.246 percent. eBank’s 9 month CD rate is currently 2.32 percent and eBank’s 12 months CD rate is currently 2.37 percent, with the national average for 12 month CD rates is 1.529 percent.

Longer term CD rates are also a lot higher than the national average CD rates. 18 month CD rates are 2.50 percent, the national average for 18 month CD rates is 1.657 percent. Two year CD rates are 2.60 percent, the national average for two year CD rates is 1.877 percent. Three, four and five years CD rates are all 3.00 percent at eBank while the national average for three year CD rates is 2.110 percent, four year CD rates is 2.308 percent and five year CD rates is 2.539 percent. The minimum opening balance for all certificate of deposit terms for eBank is $1,000.

National averages reported by Informa Reseach Services.

Citibank just lowered the CD rate and yield they are paying for a 12 months online CD. The new annual percentage yield (APY) is 2.25 percent, down from an APY of 2.50 percent. The minimum opening deposit for this CD is $500.

Citibank isn’t the only bank dropping the rates they will pay for certificate of deposit and savings account. All banks, including national banks like JP Morgan Chase and others are lowing CD rates. Regional banks and local banks are also lowering CD rates.

Even with the new lowered CD rate of 2.23 percent (APY of 2.25%) Citibank’s 12 month CD term is still the best bang for your buck as far as CD rates go at Citibank.  In fact, you have to invest in a five year certificate of deposit to receive a higher rate. Their 5 year CD rate is 2.96 percent with an APY of 3.00 percent. 

These rates are current as of April 26, 2009 for Citibank’s online CDs. Rates and yield may vary at Citibank branch locations throughout the United States.

Interest rates are so low these days getting a balance transfer credit card with a zero percent interest rate for a year is common. Another common offer these days is a zero percent balance transfer for a credit card you already have.

A third common theme for balance transfer offers these days is the fee a bank will charge for the transfer. There used to be a maximum fee charge for the transfer in the range of $75, depending on the bank issuing the credit card. Then the average fee was raised to three percent of total dollar amount for balance transfer with no maximum dollar amount for the fee. Now some banks have raised the fee to four percent without a maximum dollar amount.

When you factor in the fee you are paying for the balance transfer your interest rate isn’t zero percent anymore. If you pay a four percent fee on a $10,000 balance transfer the first year’s annual percentage rate is actually four percent. Some banks offer a 0 percent rate for only six months, this will make the actual rate you are paying even higher. 

If you decide to take advantage of 0 percent balance transfer offers from  credit card issuers make sure to read the fine print on the balance transfer fee, do the math and make sure the transaction is worth it. Since most credit card rates are higher than four percent doing the transfer will probably still make financial sense, but don’t be fooled into thinking you are receiving a 0 percent interest rate.

Best Practice: For a better credit score be sure to keep your debt to credit available ratio to around 25% on your credit cards, this is the ratio experts recommend.

This past week, the U.S Census Bureau and the Department of Housing and Urban Development estimated new home sales in March 2009 were at a seasonally adjusted rate of 356,000, down 0.6 percent. 

The median sales price continues to deteriorate, the median sales price of new homes in March 2009 was $201,400, down from $229,300 in March 2008. In April 2008 the median sales price was 19 percent higher at $246,400.

The average sales price of a new home was $258,000 in March 2009, down from $287,000 in March 2008. In April 2008 the average sales price of a new home was 18 percent higher at $314,300.

Another housing statistic release was the available supply of new home available for sale. The seasonally adjusted estimate of new homes for sale at the end of March is 311,000. At the current new homes sale rate it will take 10.7 months to sell these homes. This is down from January 2009 when the available supply of new homes would take 12.5 months to sell.

Before the housing market recovers the available supply of new homes and existing homes has to come down to more historic levels, this will stop the relentless decline in new and exiting home prices.

Ditech is offering jumbo mortgage rates with a 4.545 percent annual percentage yield (APR). The 4.545 percent jumbo mortgage rate is for their 5/1 Libor adjustable rate mortgage (ARM).

With a 5/1 ARM you lock in the current rate for 5 years then the rate adjusts every year after. Rates change constantly, check Ditech’s website for more current mortgage rates.

Ditech is offering 5/1 jumbo mortgage rates for home loan amounts from $417,001 up to $1,000,000 on owner-occupied single-family residential properties.

This jumbo mortgage rate assumes a loan in the amount of  $650,001.00 with 1.775 discount points, a down payment of 35% or greater, and a minimum credit score of 731. Ditech has mortgage brokers available to talk to you live 24 hours a day, 7 days a week. They even claimed to have closed on Christmas Day and New Years Day.

Ditech makes applying for a mortgage very easy, they have an online tool which allows you to sign all loan documents “virtually. For the home loan documents you need to actually sign they will send a notary right to your home or office.

Ditech also offers the following mortgages

30 Year Fixed Rate Mortgage- Traditional fixed rate mortgage, with as little as a 3.5 percent down payment

FHA Mortgage - As little as a 3.5 percent down payment, allowed 2 years after a bankruptcy, allowed 3 years after a foreclosure, less then perfect credit okay, self employed okay.

Flexible 30 year fixed mortgage - You can make interest only or interest and principal payments for the first ten years with no negative amortization

“Equity Build SM” mortgage - You save thousand of dollars in interest by making accelerated principal payments

Adjustable Rate Mortgages - 3/1 ARM, 5/1 ARM and 7/1 ARM

All mortgage applications are sent to GMAC Bank, Ditech is acting as a mortgage broker for the mortgage products they offer.

Mortgage rates are near an all time low set recently. This past week 30 year mortgage rates averaged averaged 4.80 percent and 15 year mortgages averaged 4.45 according to Freddie Mac’s weekly survey of mortgage rates.

Five year Treasury indexed hybrid adjustable rate mortgages averaged 4.85 percent and 1 year Treasury indexed hybrid adjustable rates mortgages averaged 4.82 percent.

These near record low mortgage rates are helping to put a bottom in housing prices. In all but three census regions of the country housing prices have actually increased last month.

In New England housing prices rose 2.2 percent, which includes Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut. In the Pacific region housing prices rose 3.8 percent. The Pacific region includes,  Hawaii, Alaska, Washington, Oregon and California.

Read more: Low Mortgage Rates Put a Floor on Home Prices

Frank Nothaft, Freddie Mac vice president and chief economist said “Although long-term mortgage rates eased slightly this week, ARM rates remain elevated relative to those fixed-rate mortgages. For instance, interest rates for 1-year ARMs exceeded those for 30-year fixed-rate mortgages over the last two weeks, this is the first time this has happened since Freddie Mac began collecting data for ARMs in January 1984.”

Rates on savings accounts, certificate of deposit accounts and mortgages have been going down the past year, this is the result of the economy tanking and the government programs in place that are trying to get the economy going again by lowering rates. 

The U.S. Treasury Department has been lending hundreds of billions of dollars to  large and small banks since the Troubled Asset Relief Program (TARP) started in the fourth quarter of 2008.

TARP has also caused savings rates to go down since banks have a cheaper source of funds from which they can borrow. There has been less of an urgent need to offer promotional deposit rates to entice depositors.

The Federal Reserve has also had its hand in forcing rates down.  The Feds have kept the Fed Funds rate at a starting range of 0 percent to .25 percent since late last year to get the credit markets and the economy going again.

The Feds have also been flooding the markets with newly printed money, buying large quantities of mortgage backed securities to further drive mortgage rates down.  A side affect of driving mortgage rates down is lower rates on deposit accounts.

Rates on savings accounts will stay low until the end of the year or early next year.  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 cause savings account rates to start creeping up again.

Record low mortgage rates have seem to put a stop to falling home prices in most areas of the United States. Housing prices have actually increased in large parts of the country the past month.

The Federal Housing Finance Agency released their U.S. Monthly Housing Price Index yesterday showing home prices increased 0.7 percent from January 09 to February 09.

This is the second consecutive monthly increase, last month’s index showed housing prices increased 1.0 percent. Year over year housing prices across the U.S. are still down 6.5 percent and down 9.7 percent of the housing price peak in April 2007.

The rate of home price increases varied by region and three areas of the country still saw a decline in home prices. Prices in the Pacific region saw the most dramatic increase of 3.8 percent the last month, but also the most dramatic decline over the past 12 months, prices decreased 19.1 percent in the region.

Home price change by census region:

Pacific Census home prices up 3.8%:  Includes Hawaii, Alaska, Washington, Oregon and California

Mountain Census home prices up 0.1%: Includes Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona and New Mexico

West North Central home prices up 1.5%: Includes North Dakota, South Dakota, Minnesota, Nebraska, Iowa, Kansas and Missouri

West South Central home prices up 1.9%: Includes Oklahoma, Arkansas, Texas and Louisiana

East North Central home prices down 1.2%: Includes Michigan, Wisconsin, Illinois, Indiana and Ohio

East South Central home prices down 0.2%: Includes Kentucky, Tennessee, Mississippi and Alabama

New England home prices up 2.2%: Includes Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut

Middle Atlantic home prices up .07%: Includes New York, New Jersey and Pennsylvania

South Atlantic home prices down 0.8%: Includes Delaware, Maryland, District of Columbia, Virginia, West Virginia, North Carolina, South Carolina, Georgia and Florida

Source: The Federal Housing Finance Agency

Since the U.S. Monthly Housing Price Index is calculated using purchase prices of homes backing mortgages that have been sold to or guaranteed by Freddie Mac or Fannie Mae it isn’t a barometer of the entire U.S. housing market. Freddie Mac and Fannie Mae only purchase or gurantee mortgages under a particular dollar amount, known as conforming mortgages.

CitiMortgage is offering a promotional deal of $500 off on mortgage closing costs. 

CitiMortgage is also offering some competitive mortgage rates. We were quoted the following numbers for fixed mortgages in Atlanta, Georgia, for a single family home with a purchase price of $500,000 with a 20 percent down payment.

CitiMortgage along with other banks and lending institutions are a lot more conservative with their loans these days. We did not receive adjustable rate mortgage quotes or interest only mortgage rate quotes. Mortgages vary from location, home and dollar amount. Check Citi’s website or call them for mortgage quotes in your area.  

30 Year Fixed Rate
Rate	Points	Premium	APR	Payment	Closing Fees
5.125%	0.125%	$0.00	5.172%	$2,177.95	$4,851.50
5.250%	0.000%	$500.00	5.286%	$2,208.81	$3,851.50
5.375%	0.000%	$2,000.00	5.411%	$2,239.88	$2,351.50

20 Year Fixed Rate
Rate	Points	Premium	APR	Payment	Closing Fees
5.000%	0.125%	$0.00	5.063%	$2,639.82	$4,851.50
5.125%	0.000%	$1,000.00	5.173%	$2,667.52	$3,351.50
5.250%	0.000%	$2,500.00	5.299%	$2,695.38	$1,851.50

15 Year Fixed Rate
Rate	Points	Premium	APR	Payment	Closing Fees
4.750%	0.125%	$0.00	4.830%	$3,111.33	$4,851.50
4.875%	0.000%	$1,500.00	4.936%	$3,137.19	$2,851.50
5.000%	0.000%	$2,500.00	5.061%	$3,163.17	$1,851.50

The 15 year fixed rate mortgage is the lowest, though with a shorter term mortgage you have to pay back the principal in a shorter period of time, this raises your monthly mortgage payments. As you can see, with a 15 year fixed rate mortgage you will pay almost $1,000 more per month than a traditional 30 year fixed rate mortgage. If you can afford it, over the life of the loan you will save a ton of money with a shorter term loan.

You can apply for a mortgage online or by calling 1-866-561-4322. Be sure to mention offer code 16586.

The Credit Cardholders’ Bill of Rights was approved today by the House Financial Services Committee by a vote of 48 to 19. The bill now moves to the House of Representatives for consideration. 

Some of the pratices include double-cycle billing, due-date gimmicks, and retroactive interest rate hikes.

The bill would also increase the advance notice of impending rate hikes and give credit card holders the information and rights they need to manage their credit responsibly. 

Banks and credit card companies would have to give at least 45 days written notice before the hike the annual percentage yield (APR) on a credit card. Let’s hope the notice is prominatly displayed and isn’t in fine print.

The badly crippled banks aren’t going down without a fight, they are lobblying against the measures which include:

• Protect cardholders against arbitrary interest rate increases
• Prevent cardholders who pay on time from being unfairly penalized
• Protect cardholders from due-date gimmicks
• Prevent companies from using misleading terms and damaging consumers’ credit ratings
• Empower cardholders to set limits on their credit
• Require card companies to fairly credit and allocate payments
• Prohibit card companies from imposing excessive fees on cardholders
• Protect vulnerable consumers from high-fee subprime credit cards
• Bar issuing credit cards to vulnerable minors 

The bill’s sponsor, Representative Carolyn B. Maloney said:

“This landmark legislation helps level the playing field between cardholders and card companies. For too long the relationship has been one-sided; but markets function best when all sides know what they’re getting into — and these deceptive practices need to be stopped. The Credit Cardholders’ Bill of Rights brings more transparency to the contractual relationship and give consumers the tools they need to responsibly manage their own credit.”

“The substantial reforms in this bill are needed now more than ever, as working Americans have increasingly turned to credit cards to help pay medical bills, buy groceries, and make ends meet in this troubled economy.”

Let’s face it, 12 month CD rates and all deposit rates are horrible these days. We seem to keep chasing rates down to new lows every week.

Do you remember scoffing at a 4.00 percent rate last fall when banks were scrambling to shore up their reserves with depositor funds before TARP? Finding a 3.00 percent rate these days would be a treat when the average rates on a 12 month certificate of deposit is less than 2.25 percent. When you factor in the rate of inflation, or deflation, things aren’t as bad as they seem.

One thing we can say for certain is rates will eventually start to go back up so don’t lock into long term certificate of deposits. Stick with shorter term CDs. The longest term we would invest in a CD is 12 months at this time. You find rates in the 2 percent to 3 percent range, which isn’t much worse than longer term CD rates. Five year certificate of deposit rates are around 3.50%.

No reason to lock in longer term at these low interest rates when rates will be higher by the end of the year or early next year.

Pentagon Federal Credit union is offering auto loans with a 3.99 annual percentage yield (APR). The rate is for new auto loans and used auto loans. If you can’t get one of those 0 percent APRs from dealers 3.99 percent isn’t a bad alternative. This rate is for interent only loans, you have to apply online at PenFed.org.

The APR is for auto loans with terms of 12 months to 60 months. PenFed is also offering auto loans with terms up to 72 months. The rate is 4.75 percent for new car loans with terms of 72 months. Used car loans with 72 month terms have an even higher rate of 8.99% APR. There are additional  restrictions for vehicles with 100,000 miles or more,

Up to 100 percent financing is available on car loans for PenFed members that qualify. PenFed is a credit union so you will have to join PenFed to qualify for these great rates. There is certain criteria you have to meet to be eligible to join. Visit their website, Pedfed.org, to find out more.

How much car can you afford? PenFed also has an auto loan calculator to help you figure out how much car you can afford. You can estimate your monthly payment for a new car loan or used car loan.

New auto loan rates

Used auto loan rates

Pentagon Federal Credit Union is offering a home equity line of credit (HELOC) with an annual percentage yield (APR) of 3.25 percent. The rate is prime plus 0 percent as of March 26, 2009. This rate is for a variable line of credit and the rate changes once per quarter.

PenFed also offers a 5/5 home equity line of credit. The rate on this loan only changes once every 5 years. The initial rate is higher on this line of credit than the variable line of credit. Currently the APR is 4.51 percent.

The 3.25 percent rate on the variable line and the 4.51 percent rate on the 5/5 if for an owner occupied home (you must live in the home). PenFed also offers loans for non-owned occupied homes. The rates for a line of credit on these homes are higher. Currently the variable home equity line of credit APR is 4.25 percent and the 5/5 home equity line of credit rates is 6.03 percent.

The loan-to-value on the owner occupied home is 80 percent and the loan-to-value on the non-owned occupied home is 70 percent. Loan-to-value (LTV) means the total amount owned on a home cannot exceed a certain percentage. Until recently banks and lending institutions were handing out loans up to 100 percent LTV or even higher, but they are being a lot more conservative in lending because home prices are falling these days. Mortgage rates have also come down more slowly than interest rates have.

Some features of the PenFed variable home equity line of credit

• No Points - You don’t pay additional money at closing. Usually 1 point is equal to 1 percent of the value of the line or loan
• No Closing Costs - PenFed will pay all closing costs associated with HELOC. If you pay the line off or close it within 24 months from the anniversary date of the loan closing, you will have to pay the full amount of the total closing cost for the loan
• Tax Deductible Interest - The interest you pay on the HELOC might be tax deductible, check with your accountant
• Fixed-Rate Equity Loan - Available in all 50 states and District of Columbia. Rate is dependent on term length, loan to value ratio, fair market value, and owner occupancy
• Variable-Rate Equity Line of Credit - Available in all states. There are additional restrictions for lines in Texas
• Owner-Occupied Property - Terms up to 20 years
• Non-Owner Occupied Property - Terms up to 12 years
• Equity Line of Credit Amount  - $10,000 to $400,000

Some features of the PenFed 5/5 home equity line of credit

• No Points - You don’t pay additional money at closing. Usually 1 point is equal to 1 percent of the value of the line or loan
• No Closing Costs - PenFed will pay all closing costs associated with HELOC. If you pay the line off or close it within 24 months from the anniversary date of the loan closing, you will have to pay the full amount of the total closing cost for the loan.
• Tax Deductible Interest - The interest you pay on the HELOC might be tax deductible, check with your accountant.
• Rate Adjusts Once Every 5 years - Rate is locked at date of application, set for 5 years. Reset for another 5 years. The index is the United States Treasury Security adjusted to a constant maturity of 5 years, as published in the Wall Street Journal and other publications. To determine your Annual Percentage Rate, we may add a margin of up to 2% for owner occupied properties and up to 3.5% for non-owner occupied properties.
• Owner-Occupied Property - Terms up to 15 years. (180 months)
• Non-Owner Occupied Property - Terms up to 12 years. (144 months)
• Equity Line of Credit Amount - $25,000 to $400,000

Home equity line of credit rates are lower than home equity loan rates. Another good thing about getting a HELOC instead of a home equity loan is with a equity line of credit you are able to withdraw only the amount you need at the time and only pay interest on the amount you use. With a home equity loan you take the entire loan amount at closing and pay interest on the entire amount from day one.

PenFed is a credit union so you will have to join PenFed to qualify for these great rates. There is certain criteria you have to meet to be eligible to join. Visit their website, Pedfed.org, to find out more

There are several cash back credit cards available today. Choosing the best cash back credit card will take some legwork on your part.

For the newbies who are just starting to use credit cards and building your credit, cash back cards give you a percentage of your purchases back in cash. 

Depending on the bank or card issuer, the cash you get back can be deposited into a bank account, credit toward gift card purchases or a credit on your credit card, either lowering the outstanding balance or giving you a credit towards future purchases.

The best way to maximize your earnings on cash back credit cards is by not carring a montly balance on your credit card. Obviously, that also is the case for any credit cards.

Other benefits to cash back cards is the cash you earn isn’t subject to taxes. Using a cash back card for large purchases is an excellent way to boost your cash back. Again, that is beneficial if you’re able to pay the entire balance off every month, otherwise you may pay a lot more in interest charges than the cash you receive.

MBR has profiled a few of the better cash back credit card offers available today

Best Cash Back Credit Cards

American Express offers the “Blue Cash” credit card. With the Blue Cash credit card, you can earn up to 5 percent cash back at supermarkets, gas stations, and drugstores. In addtion, on all other purchases you earn .05 percent and once your total purchases add up to more than $6,500 you can earn an additional .75 percent, a rate of  1.25 percent for all your “other purchases.”

American Express and Costco offer the “TrueEarnings” cash back credit card. With this card you can earn 3 percent for gasoline purchases, for annual gasoline purchases of up to $3,000, 1 percent after. 3 percent for restaurant purchases, 2 percent for travel, and 1 percent on Costco purchases and everywhere else.

American Express also has a calculator you can use to figure out how much you might earn. You are also check on your running cash back total, the breakdown of cash back earned and prior years’ cash back earned.

American Express also offers the “Plum Card” for businesses. This card gives you a 1.5 percent discount if you pay the bill in full within 10 days of the statement closing date. The discount appears on the next bill as a credit. There is an annual $185 fee for this card, the fee is waived the first year.

Discover Bank offers the “Discover More Card.” With this card you earn 5 percent cash back on travel purchases, gas purchases, grocery purchases,  restaurant purchases, home improvement purchases, department store purchases and more. 5 percent to 20 percent cash back from certain online retail purchases, 1 percent cash back on all other purchases.

The “Discover Student Credit Card” earns you 5 percent cash back on travel purchases, gas purchases, grocery purchases, restaurant purchases and more. 5 percent to 20 percent cash back from certain online retail purchases, 1 percent cash back on all other purchases.

An adjustable rate mortgage (ARM) is different from a fixed rate mortgage in many different ways. The most important difference is with a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable rate mortgage the interest rate changes periodically, usually in relation to an index, and payments may go up or down when the index goes up or down. Among the most common indexes are on 1-year constant-maturity Treasury (CMT) securities, the Cost of Funds Index (COFI), and the London Interbank Offered Rate (LIBOR).

Banks and lending institutions usually charge a lower initial interest rate for ARMs than for fixed-rate mortgages. The initial interest rate period makes the monthly mortgage payments lower for an ARM than a fixed rate mortgage for the same loan amount. An ARM could also be less expensive than a fixed-rate mortgage over a longer period of time, depending on the type of ARM, especially for a 5/1 ARM, 7/1 ARM, 10/1 ARM.

One also has to weigh the risk that an increase in interest rates would lead to a higher monthly payment in the future. Like an investment, it’s a chance you take, you get a lower initial rate with an ARM in exchange for assuming more risk over the long run. You also have to make sure you have enough income to cover the mortgage payment if rates go up. In this recent housing bubble many people were given a 1 year ARM that couldn’t afford the monthly payments when the initial interest rate reset to a higher rate. If you plan to sell your home sooner than later, rising interest rates would be less of a concern.

The initial interest rate and payment amount on an ARM will remain in effect for a limited amount of time, depending on the type of ARM, which can range from 1 month to 10 years. For some ARMs, the initial rate period and payment amount can vary greatly from the rates and payments later in the loan term. Even if rates are relatively stable, your interest rate and mortgage payment could change. When brokers quote the initial rate and payment on a loan, ask them for the annual percentage rate (APR). If the APR is a lot higher than the initial rate, it is likely that your rate and payments will be a lot higher when the loan adjusts, even if general interest rates remain the same. Use our mortgage calculator to figure out what the monthly payments might be.

With most ARMs, the interest rate and monthly mortgage payment change every month, quarter, year, 3 years, or 5 years. The period between rate changes is called the adjustment period. For example, a mortgage with an adjustment period of 1 year is called a 1-year ARM, and the interest rate and payment can change once every year; a loan with a 5-year adjustment period is called a 5-year ARM.

Two parts make up the interest rate on an ARM. The index–a measure of interest rates and the margin–the extra amount that the bank or lending institution adds. Your monthly mortgage payments will also be decided on caps–how high or low your interest rate can go.

Since your mortgage rate is tied to an index, your rate will go up when the index goes up or down when the index goes down. Some ARMs do not adjust downward, so when applying for a mortgage be sure to get an ARM that adjusts downward, if you’re taking on the risk of the rate going up, you might as well benefit when the rate goes down.

There are caps to how much the rate can increase or decrease. There is a periodic cap–limits the amount the rate can go up or down from one adjustment period to the next. There is also a lifetime cap–limits the amount the rate can increase over the lifetime of the mortgage.

Besides the initial period an ARM, there are also different types of ARMs.

Hybrid ARM:

There are often3/1, 5/1 , 7/1 or 10/1 hybrid ARMs. These mortgages combine a fixed rate period and an adjustable rate period. The rate is fixed for the first few years then adjusts annually for the remainder of the loan. For example, on a 7/1 ARM the rate is fixed for the first 7 years then adjusts every year after until the mortgage is paid off.

Interest-only (I-O) ARM:

Allows one to only pay interest on the loan for a certain period of time, no principal payments are made. This lowers the monthly payments for the loan initially but the payments increase after the initial period, even if interest rates says the same because you stay paying down principal as well as interest. For example, on a 30-year mortgage loan with a 5-year I-O payment period, you can pay only interest for 5 years and then you must pay both the principal and interest over the next 25 years. Because you begin to pay back the principal, your payments increase after year 5. In addition, you are now paying back the principal in 25 years not 30, so that also increases the monthly mortgage payment.

Payment option ARM:

This type of mortgage has gotten a lot of people in financial trouble recently. A payment option ARM is an adjustable-rate mortgage that allows you to choose among several payment options each month. Including a payment of principal and interest, and interest only payment or a minimum payment. The last payment type is the most dangerious  because the amount of any interest or principal you do not pay will be added to the loan. This increases the principal amount you owe, your future monthly payments and increases the amount of interest you will pay over the life of the loan. In addition, if you pay only the minimum payment in the last few years of the loan, you may owe a larger payment at the end of the loan term, called a balloon payment.

An adjustable rate mortgage can be a very useful financial tool if used properly. These types of loans were originally designed for people who expected there income to increase substantially, enabling them to afford a more expensive home sooner. Unfortunately, ARMs were used incorrectly by large amounts over the past several years, giving the product a bad name. If you decide to take out an ARM be sure to do your due diligence and figure out which ARM bests fits your needs or contact a financial advisor to help guide you through this process.

Evantage Bank is offering their “Mega Money Market Account” with an  annual percentage yield (APY) of 3.10 percent. The 3.10% annual percentage yield (APY) is on balances of up to $35,000. Account balances over $35,000 earn a 1.65 percent APY. Evantage Bank is the Internet banking division of Southwest State Bank based in Sentinel, OK.

The Mega Money Market account is like a checking account so you can make more than 6 withdrawals per month, unlike a traditional savings account where you are limited to only 6 withdrawals per month by law.

Evantage Bank charges $5.00 for each additional withdrawal over 6 per monthly statement cycle, a steep price to pay, so keep track of your withdrawals. The statement cycle ends on the third Wednesday of every month.

The account is easy to setup, you don’t have to sign, fax or mail any forms in. You will have to provide a Social Security or Tax ID Number, Your Driver’s License or ID card issued by a state DMV, information about any loans you might have to help them confirm you identify and for instant funding, you will need your current bank account and routing numbers. 

Evantage Bank Money Market Account Application

Mortgage rates dropped again this past week. Rates for 15 year mortgages are now under  4.50 percent and 30 year mortgage rates stayed under 5 percent.

Freddie Mac’s survey this week showed rates for 30 year fixed rate mortgages fell 0.6 percent to 4.82 percent from 4.88 percent. Mortgage rates for 15 year fixed rate mortgages also fell from 4.54 percent to 4.48 percent.

Five year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.88 percent this week, down from last week when it averaged 4.93 percent. For one-year Treasury-indexed ARMs average rate went up this past week to 4.91 percent from last week’s average of 4.83 percent.

Freddie Mac’s vice president Frank Nothaft had the following comments “Mortgage rates on fixed-rate loans and some ARM products eased this week. “The housing industry is starting to exhibit some positive signs, albeit scarce and too early to tell how permanent”.

Sovereign Bank will give you $100 for opening a checking account. You receive the promotional bonus when you open a Sovereign Premier checking account or an Interest Checking account and make a minimum deposit of $10 and request a Sovereign Check Card. 

You also have to make 6 purchases using your  Sovereign Check Card within 60 days of opening the account. If you reach the criteria of 6 purchases in 60 days then the $100 promotional bonus will be deposited into your account within 15 days after the expiration of the 60 day period. There is a limit of one $100 credit per customer and your account must be open to receive the credit.

The annual percentage yield on the accounts is nothing to write home about. For balances of less than $5,00o on the Sovereign Premier checking account  APY is 0.02 percent. For account balances of $5,000 and above the APY is 0.15%. For the Interest Checking account the APY is 0.02 percent.

Considering how low the rates are if you take advantage of this checking promo deal we suggest keeping a low balance on the account, but not so low that you incurr charges for insufficient funds when trying to meet the requirement of 6 purchases in 60 days.

With the passage of the American Recovery and Reinvestment Act of 2009, first time home buyers can qualify for up to an $8,000 tax credit depending on your adjusted gross income (AGI). The tax credit is equal to 10 percent of a home purchase prices up to a maximum of $8,000.

To qualify for the tax credit, a home purchase (closing date) must occur on or after January 1, 2009 and before December 1, 2009. Unlike the first tax credit for a home purchase passed last year, this credit doesn’t have to be paid back.

First time home buyer qualifications, limits and tips:

• The law defines a ‘first time home buyer” as someone who hasn’t owned a home for a three year period prior to the purchase.
• Vacation homes and rental property do not qualify for this credit.
•  Income limits: For single taxpayers the limit is $75,000; the limit is $150,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
• First-time home buyers who purchase a home in 2009 can claim the credit on either a 2008 tax return, due April 15, 2009, or a 2009 tax return, due April 15, 2010. The credit may not be claimed before the closing date. But, if the closing occurs after April 15, 2009, a taxpayer can still claim it on a 2008 tax return by requesting an extension of time to file or by filing an amended return
• Their is no obligation to repay the credit unless the home ceases to be your principal residence within 36 months from the date of purchase. The full amount of the credit received becomes due on the return for the year the home ceased being your principal residence.

First-Time Home Buyer Credit: Scenarios

1. Eligibility for the first-time home buyer credit is determined on the date of purchase. If  a first-time home buyer, buys a house and then later that year marries someone who is not a first-time home buyer, the credit is allowable to the first time home buyer who can take the maximum credit allowed.
2. A single first-time home buyer buys a home and a parent cosigns for the mortgage. The single first time home buyer can still qualify for the credit but the parent cannot claim any portion of the credit.
3. A person owned his principal residence. Several years ago, he decided to relocate to a rented apartment, but did not sell his  former residence. Instead, he rented it out. Now he plans to buy another house and make it his new principal residence. He does qualify for the credit as long as he hasn’t owned and used a home as his primary residence in the last three years.

To receive the home credit you will need to fill out IRS form 5405 when you file your federal income taxes.

Recent record low mortgage rates and a big drop in home prices has made housing more affordable these days. In fact, housing affordability has just hit news highs according to the National Association of Realtors. 

For every .50 percent drop in mortgage prices the monthly cost of owning a home decreases by $31.00 per $100,000 borrowed. On a $500,000 mortgage, the savings would be $445.00 per month. Another benefit to lower rates is the home buyer can qualify for a more expensive home and a larger mortgage.

In addition to the drop in home prices and mortgage rates, the government is also making housing more affordable by giving first time home buyers a tax credit of $8,000 if you buy a home between January 1, 2009 and December 1, 2009.

If you are eligible for the program, you can claim 10 percent of the price of their home, up to an $8,000 maximum, against your 2008 federal tax returns due this year, or your 2009 federal tax returns due next year. The credit begins to phase out at a modified adjusted gross income of more than $75,000, or $150,000 for joint filers.Unlike last year’s tax credit, this credit does not have to be paid back.

Chase Bank is offering a business checking account promotion that ends on April 22, 2009.

Chase will give you $200 if you open one of the following checking accounts and deposit a minimum of $500 within 30 days of opening the account. You must deposit “new money”, money not already deposited with Chase to qualify.

• Chase Business Classic Checking
• Business-Classic Checking with Interest
• Chase Advanced Business Checking
• Advanced Business Checking with Interest
• Commercial Checking
• Commercial Checking with Interest
• Chase BusinessPlus Extra Checking account

The cash promo is deposited into your checking account within 10 business days after the minimum deposit requirement is met.  The promo checking offer is only available in the following states: IL, WI, MI, IN, NY, CT, NJ, OH, WV, KY, FL, LA, OK, TX, CO, AZ, and UT.

Checking Business Checking Account Promo

Jumbo mortgage rates have been coming down but rates are still considerably higher than conforming mortgage rates.

Historically jumbo mortgage rates tend to be just a little higher than conforming rates but recently rates are up to 2 percentage points higher.

Right now, 30 year fixed jumbo rates are running at 6.20 percent¹ and 30 year fixed conforming rates are 4.95 percent¹, 1.25 percent higher.  The gap is even wider for a 15 year fixed mortgage. Mortgage rates on conforming 15 year fixed mortgage are running at 4.63 percent¹ while rates on a 15 year fixed jumbo mortgage are 5.95 percent¹, 1.32 percent higher.

The gap between jumbo mortgages and conforming mortgages has widened recently because the secondary market (securitization market) for these loans hasn’t functioned for over a year now. The securitization market is the process of packaging mortgages together into securities and selling those securities to investors.

Rates on conforming mortgages are lower because banks and financial institutions that issue the loans are able to resell conforming loans to Freddie Mac and Fannie Mae, freeing up capitial to make more loans which lowers the interest rates on conforming loans.

Shannon Drury, a William Raveis real estate agent in Westport, Connecticut, said “Jumbo mortgage rates are readily available but rates are higher than for conforming rates.  Some banks are also requiring a higher down payment on these homes.”

While jumbo rates have come down from recent highs, don’t expect them to close the gap on conforming loans until the mortgage securitization market makes a comeback in some shape or form.

¹Rate data provided by Informa Research Services, Inc.

JP Morgan Chase Bank is offering a 1 year adjustable rate mortgage with an annual percentage yield of 4.427 percent.

The mortgage quotes we received from Chase was for refinancing a loan of $400,000 on single family home in Florida. A primary residence with an estimated home value of $600,000. The credit history selected for this quote was “very good”.

We also received the following mortgage quotes based on the assumptions listed above.

Fixed Rate Mortgages

• 30 year fixed mortgage - 5.036% APR - 1.375 points
• 30 year fixed mortgage - 4.872% APR - 2.375 points
• 15 year fixed  mortgage - 4.718% APR - 1.00 point
• 15 year fixed mortgage - 4.619% APR - 2.00 points

Adjustable Rate Mortgages

• 5/1 Adjustable rate mortgage - 4.75% APR - 1.125 points
• 5/1 Adjustable rate mortgage - 4.517% APR - 2.125 points
• 7/1 Adjustable rate mortgage - 4.881% APR - 2.125 points
• 7/1 Adjustable rate mortgage - 4.770% APR - 2.00 points
• 1 year adjustable rate mortgage - 4.427% APR  - 1.00 point
• 1 year adjustable rate mortgage - 4.437% APR  -  2.00 points

We didn’t receive quotes for interest only mortgages. Chase bank has been more conservative with their loans these days. These rate quotes are as of April 12th, 2009. Quotes will vary by state, loan amount and credit history.

Nara Bank is offering a 12 months certificate of deposit that has an annual percentage yield of 3.10% as of March 9th, 2009. One of the best cd rates available today. Nara Bank has it’s headquarters in Los Angeles California and has branch locations in Southern California, the New York City area and Brick, New Jersey.

The bank’s “Mega Promo CD” has some unconventional features for a CD. You can make unlimited deposits after opening the CD. You can also make up to three penalty free withdrawals before maturity.  The minimum deposit is $10,000.

The bank waives the withdrawal penalty if a withdrawal is made after the first six days of the account term or if maintain a balance of equal to or greater than 70% of the initial opening deposit. You will also have to maintain 70% of the initial opening deposit to receive the 3.10% APY.

You can visit a local branch or call 213-639-1700 to see if these CD deal is offered in your area.

Wells Fargo reported record profits yesterday largely from their mortgage banking operations.

The bank received $190 billion in mortgage applications in the quarter, a large percentage of the applications came in the month of March when mortgage interest rates started to drop.

Based on their record profit we figured we would take a look at their mortgage rates to see how competitive their rates are. Their mortgage rates aren’t the lowest rates around but they are very competitive for a large bank. 

The national avergage APR for a 30 year fixed conforming loan is 4.985 percent¹, Wells Fargo’s rate on a 30 year fixed conforming loan is 5.086 percent².

For a 15 year fixed conforming mortgage the national average is 4.702 percent¹ and Wells Fargo’s rate on a 15 year conforming mortgage is 4.989 percent².

Here are the rest of Wells Fargo mortgage rates as of 4/11/09. Check Wells Fargo’s website for more recent rates.

¹The national average rates as reported by Informa Research Services, Inc..

²Wells Fargo rates as of 4/11/09.

We have all seen the headlines this past week, mortgage rates are up but are still under 5 percent. The Mortgage Bankers Association reported that a 30 year fixed mortgage rose to 4.73 percent from 4.61 percent and Freddie Mac released their weekly survey showing the average rate on a 30 year mortgage rose to 4.87  percent from 4.78 percent.

Mortgage rates did rise this past week but the general consensus is rates will stay low for awhile.  In fact there is even talk of 30 year mortgage rates hitting a low of 4 percent to 4.5 percent sometime this year. There is a number of factors keeping rates low. First and foremost is the economy, we are experiencing the worst economic contraction since the early 80s and as a result the Federal Reserve Bank has been keeping the Fed Funds rate at a target of 0% to .25% to jump start economic activity.

The Feds have also announced a program to buy up to 1.25 trillion of securities, including mortgage backed securities. The idea is to let banks and financial institutions unload some of these securities that they have been unable to sell which will free up capital to make more home loans. Hopefully this time around banks will be smart about whom they approve for mortgages.

Another program the Feds have announced is a program to buy up to $350 billion in Treasuries, further driving long term interest rates down.

These programs, along with the stimulus package that included a $8,000 credit for first time home buyers, will hopefully put a floor on the housing market and lead us out of this recession.

As for the direction of mortgage rates, they will probably stay low for now. Rates might go down further but not by much. If you look at a historical chart of 30 year mortgage rates they are extremely low right now so you should probably pull the trigger if you are thinking about refinancing or buying a new home. Every 1 percent rise in mortgage rates will raise your monthly mortgage payment by $63 for every $100,000 borrowed. Over the lifetime of a 30 year mortgage that can lead to ten of thousands of dollars.

Pentagon Federal Credit Union is offering a 5 year adjustable rate mortgage as low as 3.718 APR. We were quoted this rate for a 5 year ARM, with 30 year amortization, on a conforming loan of $400,000 with .375 points, for a purchase with 20 percent down in Fairfield, Connecticut.

The monthly payment on this loan is $1,967.76, this does not includes taxes and insurance. The total estimated closing costs for this loan is $4,689.66.

Here is a breakdown of the closing costs:

Pentagon Federal Credit Union Fees
Discount Points	$1,500.00
CLO Access Fee	$65.00
Total Pentagon Federal Credit Union Fees	$1,565.00
Third Party Fees
Appraisal Fee	$350.00
Credit Report	$12.66
Flood Certification Fee	$7.00
Attorney fee	$500.00
Title Insurance	$1,825.00
Survey	$275.00
Pest Inspection Fee	$50.00
Total Third Party Fees	$3,019.66
Taxes and other Unavoidable Fees
Recording Fee	$105.00
Total Taxes and other Unavoidable Fees	$105.00
Total Closing Fees	$4,689.66

The mortgage quote we were given is for a single family home, with a 20 percent downpayment in Fairfield, Connecticut. We were also quoted a 5 year ARM with a 40 year amortization schedule, the rate on this loan was 3.73% and the monthly payments were lowered to $1,798.25 because of the 40 year amortization. You pay less monthly but you will pay more interest in the long run. Mortgage rates, terms and closing costs will differ depending on the state, cost and your credit score.

PenFed is a credit union so you will have to join PenFed to qualify for these great rates. There is certain criteria you have to meet to be eligible to join. Visit their website, Pedfed.org, to find out more.

Fifth Third Bank is offering a 30 year mortgage with an annual percentage rate (APR) of 4.625 percent and an annual percentage yield of (APY) 4.714 percent.

The quote we received for this rate was a 30 year conforming loan of $400,000 with .75 points (discount points) with a 20 percent down payment in the Miami Florida area. Rates will vary depending on the dollar amount of the laon, your credit score and the state you live in.

We also received the the following mortgage quotes based on a mortgage of $400,000 in the Chicago Illinois area.

As you can see, rates on a 30 year mortgage are comparable with rates of 15 year mortgages and the adjustable rate mortages (ARMs). Though your monthly payments on the 30 year loan would be cheaper for the first five years than the adjustable rate loans. We didn’t receive quotes for interest only mortgages or jumbo 30 year fixed mortages in the two areas we targeted.

Banks in general are a lot less likely to offer interest only loans these days. Some banks and lending institutions are also not offering jumbo loans, if they are rates are considerably higher.

You can browse our mortgage rate tables and use our mortgage calculator to figure out which mortgage product best fits your needs and budget.

Mortgage applications rose last week brought on by record low mortgage rates.

The Mortgage Bankers Association’s index of  applications to purchase or refinance a home rose to 1250.6, from 1194.4 a week earlier,  an increase of 4.7 percent.  The MBA’s refinance Index increased 3.2 percent and their Purchase Index increased 11.1 percent.

The MBA’s also reported the average contract interest rate for a 30 year fixed rate mortgage (FRM) is up to 4.73, an increase from 4.61 percent. For a 15 year FRM, the average contract interest rate is 4.49 percent, up from 4.45 percent. The average contract interest rate for a one year adjustable rate mortgage (ARM) is 6.23 percent, up from 6.20 percent.

Contributing to lower mortgage rates is the Federal Reserve Bank’s decision to purchase Treasury securities and the Fed’s program of purchasing mortgage-backed securities to thaw the mortgage securitization market. The program was recently expanded to purchase up to $1.25 trillion of securities.

30 year mortgage rates are at historic lows. One can find rates from most banks under 5 percent. Last week’s Primary Mortgage Market Survey released by Freddie Mac has 30 year rates at 4.78 percent, down from 4.85 percent from the week prior. The survey is based on first-lien prime conventional conforming mortgages with a loan-to-value of 80 percent.

Conforming loans are mortgages under a certain dollar amount that either Freddie Mac or Fannie Mae purchase from banks and lending institutions after the loans are made to home buyers.

Effective November 2008, there are two sets of conforming loan limits provided for first mortgages - general conforming loan limits and high-cost area conforming loan limits. General conforming loan limits are $417,000 and high cost area loan limits are $625,000.

Loan limits in Alaska, Guam, Hawaii, and the U.S. Virgin Islands are set even higher due to the high cost of housing in those areas. General conforming loan limits are $625,000 and high cost area loan limits are $938,250.  

These limits are for single family dwellings. Two to four family dwellings loan limits are set even higher.

Rates on 30 year jumbo mortgages are higher than 30 year conforming loans, especially now because the market for loans packaged together and sold to investors has pretty much been frozen since the sub-prime mortgage meltdown of last year.

The process of packaging loans together and selling them to investors is called “securitization.”  This process frees up capital for banks and lending institutions to make more loans to home buyers.

A home equity loan is a fixed-rate loan with a fixed payment schedule based on the available equity in your home. You receive your loan money all at once and then pay it back in predictable, fixed monthly payments.

Rates on home equity loans run a few percentage points higher than a home equity line of credit (HELOC), but you have the added security knowing the rate and payment will always stay the same.

Home equity loans are usually tied to the Prime Rate published in The Wall Street Journal. The prime rate is also used to set credit card rates and auto loans.

At this writing the prime rate is 3.25 percent, which is down from 5.25 percent last year. Mortgage rates and home equity loan rates have been going down this past year because the economy is in a recession. Lower home equity loan rates are good news for home owners looking to tap into their equity.

Popular uses for home equity loans include:

• Debt consolidation - Paying off higher interest credit card debt. Most credit card rates are in the double digits, whereas home equity loan rates are in the single digits as of April 8th, 2009.
• Auto loan -  Rates on home equity loans usually run lower than auto loans.
• Home remodeling - Tapping into your home equity is a good source of funds for updating or adding an addition onto your home.

Another added benefit of a home equity loan is you can take a tax deduction for some or all of the interest you pay on the loan. Before you get a home equity loan consult your tax advisor to find out what the tax deductions might be for you.

The time is right to refinance your mortgage.  Rates are at historic lows - even lower than the rates several years ago that helped contribute to the housing boom and bust.

This time around, qualifying for a new mortgage isn’t as easy. Most, if not all banks and lending institutions require proof of income and a good credit rating.

In addition to those requirements, the loan-to-value cannot exceed 80 percent, which means your home loan cannot exceed 80 percent of the value of your home.  This more stringent but traditional requirement is making it impossible for millions of home owners who owe more than 80 percent of their home’s value or who are underwater (by owing more than their house is worth) to take advantage of record low mortgage rates. 

If your mortgage is quaranteed by either Freddie Mac or FannieMae you might still be able to refianance even if your mortgage debt is between 80% to 105% of our home’s value.  Read more on the housing bailout

If you are some of the lucky home owners that meet these qualifications, here are some quick guidelines to follow when refinancing your mortgage.

The general rule of thumb to follow when refinancing is that if the rate you are refinancing at is 1 percent less than your current mortgage rate, you should save money in the long run.

You can buy down the mortgage rate by paying mortgage points, which is like paying interest in advance. A point is equal to 1 percent of the value of the loan, so a mortgage loan of $400,000 would cost $4,000 to buy down the rate by 1.00 percent. 

If you are planning to stay in your home a long time, buying down the mortgage rate makes sense. You can save thousands or tens of thousands of dollars in interest payments over the life of the loan. Buying down the rate will also lower your monthly mortgage payment.

Closing costs: Yes, even when you refinance your mortgage there are closing costs involved.  These costs include loan origination fee, lender fees, credit report, escrow fee, title insurance, recordings fees and an appraisal report. You might also have to pay some property taxes and home insurance in advance.

Your bank or lending institution can give you an estimate of the closing costs you’ll pay on a refinance loan. The good news is these costs can be rolled into the loan so you won’t have to come up with thousands of dollars out of pocket at closing.  

Do your due diligence and comparision shop for the best rate and deal just like you would when you shop for any large purchases. Doing so will save you a ton of money in the long run.

eBank is offering their ePremium checking account that currently has an annual percentage yield (APY) of 2.50 percent for balances of $10,000 and up. Balances under $10,000 only receive an annual percentage yield of 1.00 percent.

The minimum opening balance is $100. You will pay a monthly service fee of $10 if your minimum daily balance falls below $2,500, so we would recommend maintaining the minimum daily balance.

ePremium checking account benefits:

• Free Internet banking and bill payment
• Free telephone banking
• Free Unlimited Worldwide ATM usage; currency conversion fee may apply on ATMs in foreign countries
• Earn interest on your account balance
• Unlimited check writing and free ebank custom checks
• Free 3 x 5 safe deposit box or discount on a larger size
• Free check card and no annual fee credit card
• Free traveler’s checks and free official checks

The rates mentioned above are current as of April 7Th, 2009. Check eBank’s website for more current rates.

Nexity Bank headquartered in Birmingham, Alabama is offering some of the best CD rates available today. These rates are current as of April 7 th, 2009. Check Nextiy Bank’s website for more current certificate of deposit rates.

Their 12 month CD currently has a 2.56 percent annual percentage yield, 24 month CD has an APY of 2.66 percent, 9 month CD has an APY of 2.11 percent, 6 month CD has an APY of 2.21 percent and a 90 day certificate of deposit has an APY of 1.61%.

Nexity Bank also has locations in Atlanta, Georgia, Columbia, South Carolina, Dallas/Fort Worth, Texas, Myrtle Beach, South Carolina and Winston-Salem, North Carolina.

eBank is offering their ePremier money market account which has a decent rate for these times. The rates are tiered and go has high as 2.50 annual percentage yield for a deposit of $100,000 and up. On the low end, deposits of up to $9,999 receive an annual percentage yield of 1.50%.

ePremier money market account rates as of April 7, 2009. Rates can change at any time. Check eBank’s website for current rates.

There is a minimum opening balance of $1,000. You also have to maintain a minimum daily balance of $1,000 to avoid paying a $10 monthly service fee.

Falling home prices, record low mortgage rates and an $8,000 tax credit are making homes more affordable for first time buyers. Priced out of the market during the housing bubble, first time buyers are back.

Another benefit for first time home buyers is they do not have a house they have to sell in this market. Unlike many current home owners who are unwilling to sell a home at lower prices or who are underwater by owing more than the house is worth.

Last week, the National Association of Realtors reported sales of existing homes rose 5.1 percent in February. In their weekly survey, Freddie Mac also reported that lower 30 year mortgage rates averaged 4.85 percent with an average 0.7 point for the week ending March 26, 2009, down from last week when it averaged 4.98 percent. A 15-year fixed rate mortgage averaged 4.58 percent, with an average 0.7 point, down from last week when it averaged 4.61 percent.

Housing prices are also coming back down to their historical trend line. States hard hit by the housing bubble including California, Florida, Arizona and Nevada, are seeing a large percentage of  foreclosures snapped up by first time home buyers. 

Also contribiting to lower mortgage rates is the recent decision by the Federal Reserve to purchase Treasury securities. The Fed’s action caused bond rates to drop which pushed mortgage rates down even more.

Mortgage rates and home equity line of credit rates are so low now we just found another great deal. Third Federal Savings & Loan is offering a home equity line of credit (HELOC) with a 2.99% APR for balances larger than $50,000. The HELOC rate of 2.99% is prime minus .25 percent. For HELOC balances under $50,000 the rate is 3.25% APR, prime minus .00 percent.

These rates are not introductory rates or teaser rates, the rate you receive when you open the line of credit is the rate you receive for the life of the line of credit.

HELOC benefits:

• NO Application Fee
• NO Closing Cost
• NO Doc/Stamp Tax (Florida)
• NO Origination Fee
• NO Pre-Payment Penalty
• NO First-Year Annual Fee

There isn’t a minimum advance or draw required when opening the line of credit. ThirdFederal also guaranteed to be the lowest rate anywhere or ThirdFederal will give you $1,000.

This post was featured on http://greenerpastures.responsiblepersonalfinance.com/2009/04/08/the-money-hacks-carnival-59-the-duct-tape-edition/

MonitorBankRates.com has just released new bank rate tables for certificate of deposit - CD rates, checking account rates, mortgage rates, refinance rates, savings account and money market account rates.

The tables can be accessed under their respective tabs from our home page. To display a list of banks offering rates in your area all you have to do is enter your zip code and select the display table button and banks offering rates in your area will be listed.

We searched for a 12 month CD for a $10,000 deposit in the state of California.

These results are for zip-code 90017 in Los Angeles.

Go ahead and give our bank rate tables a try and find the best rate possible by comparing banks. Bank rates are updated daily. Results will very by zip-code.

In addition to the bank rate tables mentioned above, MonitorBankRates.com can also provide you quotes for auto loans, auto insurance, health insurance, life insurance, home insurance, motorcycle insurance and business insurance. MBR also has a selection of financial calculators to help you figure out the best way to manage your finances.

Finding affordable health insurance is a challenge these days since the cost of medical care is going up by leaps and bounds. Another challenge is paying for health insurance if you’re unempolyeed or have recently lost your job.

One of the benefits from the government’s stimulus package is a subsidy of the monthly premium cost. The government subsidy started on February 17, 2009.  It helps pay the monthly health insurance premium for individuals who involuntarily lose their jobs and qualify under federal COBRA law.

This is how the program works: the individual pays 23 percent of the health insurance premium and the previous employer or health insurance company pays 65 percent. The amount paid by a previous employer or health insurance company is reimbursed by the government as a credit against their payroll taxes or as a refund.

The subsidy is for up to nine months for individuals who worked for an employer with twenty or more employees and who are eligible to continue their health insurance coverage  through their former employer under COBRA.

The subsidy program is also good for up to six months for individuals who worked for a small business with fewer than twenty employees and who are eligible to continue their health insurance coverage  through their former employer under COBRA.

Bank of America is offering their “Net 5″ (5/1 interest only payment) adjustable rate mortgage (ARM) which currently has an annual percentage rate of around 4.50%.

We were quoted this rate for a conforming loan, in the state of California, with an excellent credit rating. Mortgage rates will vary slightly depending on the dollar amount, your credit score and the state you live in.

These days, most people would shy away from an ARM that has an interest only payment, in fact some banks don’t even offer that type of mortgage product right now.

Interest only ARM’s are designed for people who expect to increase their income over the course of the loan, since the initial payments are lower this enables one to borrow more than he or she would have been able to afford. When their income increases they are able to afford the higher mortgage payments.

Interest only adjustable rate mortgages are also a good tool for investors, it allows them to generate more cashflow because the mortgage payments are lower.

Be sure to do your research when obtaining a mortgage refinancing a mortgage.

We were also quoted these mortgage rates from Bank of America based on the criteria listed above.

	Mortgage	Rate	Points	APR	Payments
	NET 5® (5/1 Initial Interest-Only Payment) ARM	4.750	1.000	4.551	$1,583.33
	NET 5® (5/1 Initial Interest-Only Payment) ARM	6.000	0.000	4.909	$2,000.00
	NET 5® (5/1 Initial Interest-Only Payment) ARM	4.125	2.000	4.415	$1,375.00
	30-Year (10/20) Fixed-Rate Interest Only Mortgage	5.750	1.125	5.910	$1,916.67
	30-Year (10/20) Fixed-Rate Interest Only Mortgage	6.125	0.000	6.193	$2,041.67
	30-Year (10/20) Fixed-Rate Interest Only Mortgage	5.500	1.500	5.688	$1,833.33
	5/1 Adjustable-Rate Mortgage (ARM)	4.250	0.875	4.354	$1,967.76
	5/1 Adjustable-Rate Mortgage (ARM)	5.125	0.000	4.603	$2,177.95
	5/1 Adjustable-Rate Mortgage (ARM)	4.000	1.500	4.316	$1,909.66
	3/1 ARM	4.500	1.000	4.423	$2,026.74
	3/1 ARM	5.625	0.000	4.604	$2,302.63
	3/1 ARM	4.000	1.875	4.381	$1,909.66
	30-Year Fixed-Rate	4.750	1.000	4.908	$2,086.59
	30-Year Fixed-Rate	5.125	0.000	5.196	$2,177.95
	30-Year Fixed-Rate	4.375	2.000	4.617	$1,997.14
	40-Year Fixed-Rate	5.625	1.000	5.765	$2,097.21
	40-Year Fixed-Rate	6.000	-0.625	6.064	$2,200.85
	40-Year Fixed-Rate	5.500	1.250	5.658	$2,063.08
	15-Year Fixed-Rate	4.250	1.375	4.578	$3,009.11

Bank of America is offering a special limited time promotional money market savings account with an annual percentage yield (APY) 2.50% for balances between $10,000 and $500,000.

Balances over $500,000 earn a 1.50% APY. Money market savings interest rates for both balances tiered are accurate as of April 1st, 2009.

The 2.50% yield is not the only good part  about this promotion, the 2.50% rate is also guaranteed until June 30th,2009. The bad part of this promo savings account is it’s not available in the entire United States, the offer is only available in the Northeast in the following states: NY, TX, DE, IL, ME, MA, NH, NJ, PA and RI.

After June 30th, 2009 the promo money market savings account converts to B 0f A’s “Growth Money Market Savings” account.

If you’re interested in this promotional deal you might want to act fast, not only because you have a limited amount of time to earn a 2.50% yield but B of A is also reserving the rate to stop opening new “Money Market Savings Accounts” at anytime.

Some leading economic indicators are pointing to the bottom of the current recession - at least that is the hope. 

If the economy is hitting a bottom that will also spell the bottom for interest rates on deposit accounts and mortgage rates.

The positive side:

This past week Cleveland Fed President Sandra Pianalto said “I expect economic conditions to stabilize by the end of the year and then begin to recover next year as the fiscal stimulus boosts spending and as we work off excess inventories.”

Also this past week, the  National Association of Realtors reported that sales of pending homes rose a seasonally adjusted 2.1% in February, with increases in the Midwest increasing 14.8% and Northeast increasing 15.6%.

The negative side:

Economists are estimating that 660,000 jobs will be lost in March.  The monthly employment report will be released tomorrow by the Labor Department.

ADP and Macroeconomic Advisers said the private sector lost an estimated 742,000 jobs in March.

One can argue that the glass is half full or half empty, depending if you’re an optimist or a pessimist. One thing is for sure - interest rates are so low, the potential for further declines is small but there is a lot more potential for the upside.

That being said, I would stick to shorter term certificate of deposits than locking in these low rates for a long term. If a recovery does happen later this year or early next year rates will start going up quickly and will start going up before the recovery takes hold.

Freddie Mac just reported in their weekly Primary Mortgage Market Survey that mortgage rates have hit another record low.  Rates for a 30-year fixed-rate mortgage (FRM) averaged 4.78 percent and rates for a 15-year FRM averaged 4.52 percent.

As for adjustable rate mortgages, five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.92 percent and one-year Treasury-indexed ARMs averaged 4.75 percent.

Chart Source: Freddie Mac

HSBC Direct is offering a twelve months CD yield of 2.30%. The yield is higher than HSBC direct’s online savings account which currently has a yield of only 1.65%.

There is a penalty for an early withdrawal of 30 days simple interest (Interest paid only on the original principal, not on the interest accrued).

HSBC Direct is also offering the following certificate of deposit yields:

• 6 months CD - 1.25% APY
• 9 months CD - 2.05% APY
• 18 months CD - 2.35% APY
• 24 months CD - 2.05% APY
• 30 months CD - 2.05% APY
• 36 months CD - 2.05% APY
• 48 months CD - 2.35% APY

These yields are current as of April 1st, 2009. Check HSBC Direct’s website for more current rates.

Historically, the average rate on a checking account is usually less than an  online savings account or longer term certificate of deposit. Though there are high yield checking accounts that can earn a yield upwards to 5.00% or more.

These higher yielding checking accounts are usually called “reward checking accounts” and require you to do a certain amount of transactions per month.

Transactions include, using the checking account for one or more automatic transactions per month,  either a direct deposit of a payroll check,  Social Security check, or an automatic monthly withdrawal to pay a bill. Most reward checking accounts also require you to receive electronic statements. Some checking accounts are offered by credit unions that you have to join.

Including a higher checking yield, some banks also offer other benefits including reimbursement of ATM withdrawal fees (there is usually a maximum dollar amount per month), free checking and no minimum balance.

Most banks also have a maximum dollar amount that can earn the higher checking yield.  If you fail to meet all the transaction requirements for a certain month the account will probably earn a yield of less than one percent. The good news is the lower yield is only for that particular month, the following month you can earn the reward yield if all the required transactions are done.

Here is a short list of banks offering Reward Checking Accounts. These rates are as of April 1st, 2009. Please check the bank’s website for more recent rates.

• Connexus Credit Union - 5.15% APY up to $25,000
• Malvern Federal Savings Bank - 5.01% APY up to $35,000
• Altra Federal Credit Union - 4.25% APY up to $25,000
• Grand Bank of Texas - 5.02% APY up to $25,000
• Focus Bank - 4.51% APY up to $25,000

Banks that offer reward checking accounts allow you to sign up online. Banks also make it very convienant to open and maintain an account even if you are located hundreds of miles away.

Capital One Bank is offering a promotional bonus of $50 for opening an online savings account.  To take advantage of this offer you will have to open an account by April 15, 2009 and deposit at least $10,000 by May 8th, 2009.  The account you open must be your first account with Capital One Direct Banking to receive the promo savings account bonus.

If you’re just intereted in opening a savings account but don’t have the funds to deposit to take advantage of the bonus offer you can, the minimum opening deposit is only $1.00.

The annual percentage yield (APY) on the account is tired, the bank rate is decent if you deposit  at least $10,000. Online savings account balances of  $10,000 or more receive a 2.01% APY. Balances of $0.01–$9,999.99 receive a 1.01% APY. As with all savings accounts the rates are variable and may change at any time.

Be sure to use the savings account promotional offer code: OFFER50

Capital One Bank Online Savings Account Promtional Offer