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Certificate of Deposit Renewal Letters in the Digital Age

By Jim Bruene on November 15, 2010 6:40 PM | Comments (4)

image Today I received a letter from a large credit union (note 1) informing me that my certificate of deposit was up for renewal. I was given six choices at the bottom of a form (note 2) along with a postage-paid return envelope. 

Had I received that letter in 1988, I would have considered it state of the art. But in the modern world of instant communications and researching rates via Google, the communication was inadequate and reflects poorly on the CU's brand:

  • No current rate info: I realize that rates are subject to change and are miserably low, but at least tell me what they are today so I have some idea of what's going on. While you are at it, remind me of what my rate was. Avoiding naming the specific rate is a huge red flag that yours is probably not so competitive. Plus, it's irritating when it's obvious how easy it would be to program current rates into the form letter. The CU did at least direct me to its website and call center to find current rates. However, the call center had no main menu option for rates, so you had to guess which number made the most sense. 
  • No email/call center option for choosing: The only way to communicate my investment choice is to return a postage-paid envelope. How about an email address, phone number of even a simple URL?
  • No email notification: I signed up for this account online, and the bank's marketing messages arrive via email. Why didn't I get an email asking me which option I prefer?
  • No clear info on what happens next: According to the fine print buried in the accompanying Truth-in-Savings disclosure, my certificate will automatically renew if I take no action. But nowhere in the main letter does it say that, nor is the deadline for taking action spelled out. The "current maturity date" is provided, but that's using banking lingo that could be clearer.
  • No niceties (or even a sales pitch): The letter was bare bones with just two sentences and an info box about my CD (note 3). There was no salutation, no signature, no thank-you, no names of anyone at the CU, no local branch info, no encouragement to renew, and so on. 


1. As previously noted, we generally avoid posting the name of financial institutions that we criticize here; but we'll privately tell readers so long as it's not posted online (email me if you are curious).
2. The choices:
     A. Change term to 6, 12, 24 or 36 months (it was already 12 months, so that was a
          bit confusing, too). 
     B. Deposit to another account with a blank for writing in the account number
         (and no instructions on whether that had to be an account at the CU)
     C. Send a check for the balance (but with no ability to take a partial payout)
3. My CD is small ($500) and was set up online through a now-defunct third-party. So it's very possible that there are different communications sent to larger CD holders, and/or those that were acquired by a specific branch.

Comments (4)

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Ok, they violated the regs. So did you call and inform them of their gross oversight?

I seriously doubt they violated any regs. The letter is in compliance (required) but doesn't really speak to customer needs (optional). --Jim

I just got a similar notice from ING Direct (via email), they also didn't list the rates, but it is a much friendlier/informative message:

Subject: Your Orange CD is About to Mature!

Dear Alex,
Customer Number: XXXXXXX

Your Orange CD Maturity Options

You made a smart decision to save with ING DIRECT when you opened Orange CD (XXXXXXX). Your CD will mature on 11/27/2010.

Upon maturity, your Orange CD is currently set to renew. The entire balance will roll over into a new Orange CD with the same term unless you have elected to renew into a different term.

To review or change your maturity options anytime before the maturity date:
1. Sign in to ingdirect.com
2. Click on your Orange CD
3. Select 'Account Maintenance'

If your CD is set to renew, please keep in mind:
• It’s important to review current Orange CD rates at least one day prior to maturity at ingdirect.com or by calling our Interactive Phone Service at 1-888-464-7868 as interest rates may be different on the day your CD matures.
• View your CD Truth in Savings Disclosures.
• If your CD renews, you have up to 10 days after the maturity date to close it without penalty.

Thanks for saving with ING DIRECT.

I've gotten to the point that I don't even look for a phone number anymore. If an issue can be solved online, great. The amount of time it takes to reach a customer rep by phone, however, is not worth it. I almost miss the old-fashioned renewal letters.

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