What’s the difference local bank CD rates and online bank rates?

Why are local banks CD rates so much lower than the CD rates of online banks such as ING? Why can’t a local bank offer the same rate?

By | 2013-08-27T11:19:10+00:00 August 27th, 2013|Mortgages Home Loans Interest Rate|3 Comments

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  1. kim m August 27, 2013 at 11:52 AM - Reply

    Local banks have to pay for the building, the electricity, the staff. Online banks do not so they have much more money to offer.

  2. *J* August 27, 2013 at 11:39 AM - Reply

    Local banks sometimes have more overhead, than those banks that are strictly of the online variety and do not operate a traditional storefront. As for the difference for banks that operate on both fronts, they are trying to amp up their online business and lure customers in that arena and that is really the only reason for the difference.

  3. David Z August 27, 2013 at 11:22 AM - Reply

    local banks are not trying so hard to get deposits. no difference.

    only way for that on line bank to attract your deposit is to offer high rate. if FDIC insured go with higher rate.

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