10% 6-Month CD ($2.5K Max) Continues at Flagstar Bank

Flagstar Bank continues to offer a 6-month CD promotion with a yield of 10.00% APY. The minimum deposit is $500, and the maximum deposit is $2,500. It does require you to jump through some hoops. A new checking account is required, and you must have at least 15 transactions per month (can include online bill payments, debits and credits). Instead of the 15 transactions, it appears you can also satisfy the CD requirement with $250 direct deposit of income per month. A $100 penalty may be imposed if the checking is closed before 6 months or if you fail to meet the transaction requirements.

This special is not listed at Flagstar's website. It was advertised in today's Holland Sentinel newspaper in Michigan. The ad is available online here. I last reported on this 10% CD in April.

This CD special is more like a checking account bonus. If you have $2,500, you'll make about $87 more than a 3% account for 6 months.

Matching CD Rates

Readers have informed me that Flagstar will beat any CD rate by 0.05% from a bank within the same county. Another reader reported that Flagstar in Georgia applies this to the entire state. So you can see if you can use this to get a 4% CD (see post).

Flagstar's Express Money Market Account

Flagstar continues to have one of the best online money market accounts, and it's available to people in any state (see post).

Financial Health

Flagstar has been hit hard by the mortgage mess. It has only a 1 star rating at Bankrate.com based on 12/31/07 data. However, BauerFinancial gives Flagstar 3 stars (adequate) based on more recent data (3/31/08). As with any bank, always keep below the FDIC limits (Flagstar FDIC Certificate # 32541).