E Loan is waiving the early withdrawal penalty on CDs for the month of March. It may be helpful for consumers who need the cash but it's also a move by E Loan to phase out high yielding CDs.

In December of 2007, the average rate on a 3-year CD was 4.72% APY. Last week, the same CD yielded an average rate of 3.10% APY. Rates have tumbled over the last six months and banks are looking at ways of reducing the amount they pay in interest. So, like a homeowner refinancing their mortgage, or a bond issuer, calling a bond, they are looking to call back as many higher yielding CDs as they can. Banks are also awash in deposit cash and can afford to let high priced money go and replace it with lower cost deposits.

The text of the email is below:

E Loan Email

Times are Tough - and we’d like to offer a helping hand!
Recently, many customers have been asking to close their existing E-LOAN Certificates of Deposit (CDs) early. Our customers note they need access to these funds due to financial hardship or for paying off debt.
We’ve listened to our customers and come up with a unique offer.
For the entire month of March 2009, E-LOAN will waive its Early Withdrawal Penalty if you close your CD early. For many of our customers this could mean substantial savings in penalties normally associated with early account closure.

CD Term Early Withdrawal Penalty
1 year or less 3 months simple interest
More than 1 year 6 months simple interest

If you would like to continue maintaining your CD with us, please rest assured your funds are safe and will earn the regularly scheduled interest for the existing term.

However, if you would like to access your money early, please adhere to the following two guidelines:
(1) In order to close your CD with no penalty you must log in to your account and send us a secure message asking us to close your account without penalty. Requests received by Wednesday each week will be processed by the following Friday. Funds will be received in your externally linked account the following week.

(2) Your account will be closed and funds returned to your externally linked account, which must still be open, valid and verified in order for the funds to be returned.

Act quickly; this is a limited time offer and one part of the E-LOAN stimulus package!

Goldwater Bank is offering a 3.03% APY 36-month CD with a minimum balance of $50,000. That's the best 36-month CD rate according to the BestCashCow rate table.

We covered Goldwater Bank back in August 2008 when savings rates were still paying 4% (remember those days). Goldwater is now paying 1.52% APY on its savings account. That's not terrible but certainly not one of the best savings rates.

The bank opened in 2007 and now has 14 employees and $29.8 million in deposits. It's too new to have a Bauer rating but it is FDIC-Insured (FDIC Certificate # 58405).

Acccount Opening

Once you fill in the online form, they'll mail you a signature card. You can mail a check with the signature card or do a wire transfer. They do not accept ACH transfers. Wire transfers are free from their end.

Goldwater Bank has a 3 out of 5 (Adequate) star rating from Bauer Financial.

Dime Bank is offering a 2.50% APY 15-Month IRA CD. That's very competitive for a CD of that term. The best 1-year non-IRA CD according to the BestCashCow rate tables is 2% APY and the best 18-month CD is 2.20% APY.

The account is available nationally and can be opened via phone or by mail. Unfortunately, there is no online application.

Because this is an IRA CD, the maximum that can be deposited is $5,000 per year, $6,000 if you are 50 and over. The minimum deposit is $500.

The Dime Savings Bank of Williamsburgh, the formal name of the bank, is a wholly owned subsidiary of Dime Community Bancshares, Inc. (NASDAQ: DCOM), a publicly-owned company. The company has 23 branches mainly located in Brooklyn and Queens and over 400 employees.