POD Accounts — Are they insured?

Naturally, if there weren’t a question, I wouldn’t be writing this post.? :O)? Many, many people became concerned after the recent ANB Financial failure.? So I figured I would provide some clarifications and hopefully helpful information.

Here is the info from the FDIC (bolding added by me).

POD accounts are insured up to $100,000 per owner for each beneficiary if all of the following conditions are met:

• The account title must include commonly accepted terms such as “payable-on-death,” “in trust for,” or “as trustee for” to indicate the testamentary nature of the account.? These terms may be abbreviated as “POD,” “ITF,” or “ATF.”
• The beneficiaries must be indentified by name in the deposit account records of the bank.
• The beneficiaries must be the owner’s spouse, children, grandchildren, parents, or sibling.? A beneficiary that meets this requirement is called a “qualifying beneficiary.”

Much of the confusion has come about because many bank employees tell depositers that they just need to indicate the beneficiaries in the account records.? This is not true.? The account title must contain?the “secret” letters as noted above.? This means that if you are doing POD type accounts for the purpose of maximizing FDIC insurance coverage, you will probably need at least two accounts.?

For instance, if you aren’t married, but have a sibling you can have up to $200,000 of insurance at each bank.? You would need to have one account?titled ?”Your name” for $100,000?and a second account titled “Your Name POD”.? The second account also needs to have the benenficiary indicated in the bank records.? Although not required, it would be a good idea if there aren’t too many beneficiaries to put them on the account title after the “POD”.

What should you do if your accounts don’t have “POD” indicated on them?? That is an excellent question and I even sent the FDIC a message to clarify the requirements and I asked them exactly that.? Although my personal belief is that the FDIC would honor the intent of the account, I wouldn’t want to risk $100,000 or more.? Here is their response:

Inconsistent or incomplete records, in which the owner’s intentions are not clear or in which the regulatory requirements are not met may result in unintentional uninsured funds in the event of a failure of an insured bank.

As to your question, “What should a consumer do if a bank refuses to change the title, already has their funds, and refuses to send the uninsured funds back without penalty?” the FDIC would suggest filing a complaint with the FDIC stating the failure of the specific bank to comply with section 12 C.F.R. Part 330.10(b).? The website for filing a complaint is found at https://www4.fdic.gov/STARSMAIL/index.asp.

Feel free to contact us if you have any questions.

cd :O)

Greystone Bank – Certificate of Deposit Rates

Updated: 6/17/08.? Greystone Bank was established on November 1, 2005.? They aren’t a large bank.? As of?March 08, assets were a little over $274MM.?? They do currently have an operating loss of $1.58MM.? They are considered well-capitalized.? FDIC# is 58094.

View their website, here.

Tough Call – To Post or Not

I really struggled with whether to make this post or not.?? It isn’t business related nor on topic for what the blog is usually about.? I even have other posts I would like to make. But, I just felt the need to express a few thoughts.?

Regardless of your circles, you probably heard that Steven Curtis Chapman and his family suffered a devestating loss yesterday.? Their five-year old daughter, Maria Sue,?was hit in the driveway by one of their other teenage children driving home.? The teenager didn’t see her.? I know the Christian community (of which I belong) is reaching out to them with prayers and looking to help anyway they can.?

Although, receiving prayers from all over the world I’m sure helps bring comfort this is probably a case where they really don’t want the attention.? However, that really isn’t the point of my post.

Tragedies like this happen everyday.? Families experience loss everyday.? Since I do have a large family, it just struck a chord.? I have a daughter that is the same age as?Maria Sue?was.? We don’t expect things like this to happen to us.? Nobody is immune from loss or tragedy.? No matter how many records you’ve sold, miles you’ve walked, or days you’ve taught.? No matter how many people know your name, how many hearts you’ve fixed, how many teeth you’ve repaired, or how many sermons you’ve preached.? No matter how many posts you’ve made, how many bad guys you’ve caught, how many wars you’ve fought, or how many fires you’ve put out.? Your next day is not promised.? Those around you are not promised another day with you.

Take time today to make sure those you love, know it.? Take time today to heal broken relationships.? Take time today to make sure things are in order.? Give your wife, your children, your friends, your boss, your pastor, your paperboy, whoever an extra hug today.

Finally, I have certain beliefs that allow me to not fear such tragedies.? I know there is a God who is bigger than I am, and He is in control.? However, I’m not going to beat you over the head?with those beliefs.? Sometimes, though, it takes a tragedy to ask the right questions and to seek the right answers.? I’ll leave you a link if you want to explore more.? On Tuesday, Lord willing, its back to business.

www.purposedriven.com/salvation

cd :O)

AARP Savings Account Rate

Updated: 7/08/08.? AARP had an amazing savings rate.? They took in a lot funds and then kindly dropped the rate.? It stands at 4.05%?APY.? The underlying bank is Huntington National Bank.? Their FDIC # is 6560.? I will warn you though.? The health of Huntington is questionable.? Granted, they are a very large bank, about $54BB, and the Fed has shown some resistance to allowing large banks to fail;?the Fed?did close down ANB Financial, about $2BB.

Bankrate.com gives them 3-stars which is average.? When I actually tried to review the report, there was an error.? Interestingly enough, there was a big ad for AARP on the site.? I’m jealous.? The rating system we use gives them the equivalent of 1-star.? That is for data reported as of 12/07.

I believe the deposit may be able to be held at Countrywide instead.? I saw some other people posting they wouldn’t dare let that happen.? Ironically, Countrywide has a higher rating in the system we use (3-stars), but everyone has been scared away by the bad press.? Bankrate.com has Countrywide as unrated.

So tread carefully.? I would recommend keeping funds under $100,000 if you go through with the deposit.? If you are doing POD accounts make sure it is titled correctly.? The FDIC regs say not only do the bank records have to clearly have the beneficiaries listed, but the letters POD or ITF have to be on the account title.

Here is the AARP link.

cd :O)

Seriouspaid.com — Review (Be Careful)

As many of you know, we host google ads on our site.? Most of the Ads are for other sites also offering CD Rates and/or savings rates.? Some are offering Corporate notes and other investment opportunities.? We make no warrant or guarantee for these ads.? At times, we do find it necessary to block certain ads that we feel many pose too much risk to our viewers.? This is one of those times.

Last night I noticed an add for a site Seriouspaid dot com (I won’t give them a benefit of a link).? They were promising returns of around 4000% for 6-days.? My motto, if it is too good to be true, it probably is.? After some further research, I found some?info on Yahoo answers, Yahoo Answers – Seriouspaid?.? There was a second link I found last night, but I can’t find it now.? I couldn’t find anything postive about them.

As always, do your due diligence before doing any investments.? I hope this is helpful information.

cd :O)

Peer-to-Peer Lending

This is a sponsored article. We’ve added a new section on our website about Peer-to-Peer lending. I’m pretty excited about it. Of course, I don’t want you to take all of your investable funds this route, but a properly managed portfolio can earn you some good returns.

Peer-to-Peer lending basically cuts out the bank and you lend directly to the borrower. For obvious reasons, it is also known as Person-to-Person lending. Prosper is one of the premier services in this area. Your funds aren’t insured like an FDIC insured CD, and you can lose principal, but Prosper goes along way to make sure you know the background of the borrower.

Check out the new section, let me know what you think. Peer-to-Peer Lending.

If you are in the need for a loan and your credit isn’t stellar, check out loans for bad credit.

Signature loans can be another option.
cd :O)