Comments on: What Happens to Your CDs When a Bank Fails?

By: Rhonda Leek

Rhonda Leek — Wed, 26 Oct 2011 07:02:39 +0000

What happens if the last parent (mom) just passed away,
left a envelope in safty deposit box at
wells Fargo, brother (POD)for Wells Fargo only, got things out, gave to me (sister) in envelope a Certificate of deposit for my brother and myself, BUT!Her name is on it,it just states what it is and who its for on the front of envelope The bank closed in Oct of 2011, FDIC took over..Is there a clause in these CD’s for Rules and Regulations that is chosen by depositor to pay upon death? to son and daughter? She did not leave a will..But we are benificaries to the Property (home/land)everything is split equally..Will this apply to the CD also? When FDIC finds the funds!!!

By: #1HB4DB

#1HB4DB — Wed, 13 Aug 2008 13:34:02 +0000

This post rings true for me- I bought an IndyMac CD at 4.35% the DAY before it failed. I received a statement in the mail over the weekend, and sure enough, I’m earning my interest. I’m comforted knowing that should another bank come in and take over the assets of the new IndyMac Federal Bank, I will have the option of withdrawing my funds if they propose a lower rate. Until then, I’m safely earning the highest yield out there.

By: BankAround

BankAround — Mon, 11 Aug 2008 15:01:47 +0000

Thanks for the post. I think it’s important for people to understand and not to cause a panic by going to the bank and taking out money on any little rumors.

By: Mark Nelson

Mark Nelson — Mon, 11 Aug 2008 13:38:43 +0000

The bank crisis certainly has people a little nervous. It will be interesting how this all shakes out.

By: Dividend Growth Investor

Dividend Growth Investor — Sat, 09 Aug 2008 22:24:38 +0000

That’s a good thing to know that you can get the highest yielding CD out there and even if the bank fails, as long as you have less than $100k invested there you will walk away safely.

By: Chris Desmond

Chris Desmond — Sat, 09 Aug 2008 13:55:24 +0000

Hey Nick, do me a favor and prominently post the date on your blog entries. I find it useful to click on related past entries that you list at the bottom of your daily entries, but irritating that I cannot quickly tell when you wrote them. Some entries, like milk, have a “sell-by” usefulness date. Put another way, I want to know how “stale” your product may be before I invest my time to read it.

On another note, I had $103,500 CD at IndyMac Bank when it failed. It took until 8/8/08 for the FDIC to call and inform me that, due to the way I had the account configured (held within a trust with 4 beneficiaries), it was 100% insured. Even at that, I had to first send in an account-ownership-affirmation letter. So, I’m relieved. Even better, I can now liquidate the CD without penalty, or leave it there, with the 4.01% APY term unchanged, until its 10/20/08 maturity date.

By: MITBeta @ Don't Feed the Alligators

MITBeta @ Don't Feed the Alligators — Fri, 08 Aug 2008 13:11:58 +0000

I can provide first hand corroboration about the Netbank –> ING transfer. I had 5 CDs with Netbank that were transferred relatively quickly to ING. Soon thereafter I got a notice that the rate was going to change (go down, of course) and that I could withdraw my money with no penalty. It made sense to withdrawn 2 of the longer term CDs since I could find better deals elsewhere, but the shorter term ones stayed.