Lafayette Federal Credit Union - Off the charts penalty for early withdrawal on CD
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Junior Reviewer
Updated by user Sep 12, 2023
I haven't heard from Lafayette Federal. They don't seem to care if a customer who recommended them to lots of other people has an emergency and needs to withdraw funds preferably with the withdrawal penalty waived.
Updated by user Aug 13, 2023
https://***/news/auto-insurance-health-insurance-bills-after-car-accident/ I emphasized to Lafayette Federal Credit Union all the way to the CEO my health has deteriorated since this and this is why I needed to take an early withdrawal. They didn't seem to care.
Updated by user Aug 13, 2023
https://***/news/auto-insurance-health-insurance-bills-after-car-accident/ This is what I have been dealing with and it has only gotten worse. They know at Lafayette Federal Credit Union all the way up to the CEO and don't seem to care.
Original review posted by user Aug 13, 2023
I would give negative stars if I could. I opened a 5-year CD with Lafayette Federal Credit Union last year.
I had all kinds of issues opening the account and finally got it resolved when I emailed LFCU leadership. I had a family emergency which meant I needed to cash in the CD early. Top my surprise, they had a 600-day penalty for early withdrawal on my CD. I don't recall seeing this when I opened the CD.
You will not see this in the certificates section of the LFCU website lfcu.org/personal/certif. Hidden on the LFCU website is all the penalties for early withdrawal. lfcu.org/files/Fixed-Rat
There are plenty of banks out there with similar or higher rates with far lower penalties for early withdrawal. You can even get similar rates on US Treasury Notes with no state tax and no penalty for early withdrawal.
LFCU says it is Member-Owned, Not-for-Profit -You're a member AND an owner at Lafayette Federal.
We treat our members as unique individuals with specific needs and financial goals. We are member-owned, not-for-profit, and community-minded. This couldn't be further from the truth based on my experience.
The penalty for early withdrawal section shown above which I don't recall seeing when I opened the CD says LFCU MAY impose a penalty for early withdrawal. They want to impose a huge penalty and this is after escalating to LFCU leadership.
User's recommendation: Avoid like the plague unless you are ok with huge penalties for early withdrawal even in emergencies.
Monetary Loss: $9500.
Preferred solution: Full balance in account with interest earned. .
Lafayette Federal Credit Union Cons: Huge penalty for early withdrawal even in emergency- 4x of ally.
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Comments
Don’t be passive/aggressive and say “even in an emergency.” They are bankers, not your friends. No one told you to do a five year CD.
And to be honest, even an amateur knows there are only two important pieces of info with a CD.
The % return and what your total is after five years and a year one through four breakdown of the penalty for breaking the CD. So go cry yourself to sleep.
It’s clearly stated on the site. Do better.