Internet banking

January 24, 2005 12:47 PM

Any experience with ING Orange Savings/other internet banks? (+)

My wife and I hope to buy a house in the next 8 months or so (no earlier than July, but if after September we'll put it off for another 6 months-year). We've saved up for a down payment, and currently have it in a savings account at our bank that earns 1.44% interest. I want to move it to an ING Orange Savings Account where it will earn 2.35%. My wife, who would keep our money under our mattress if I let her, wants to leave it where it is and worries that the money wouldn't really be quickly accessible from an ING account.

So: any experience with ING or other high-interest internet banking savings accounts that could help persuade her? Do you agree with her that such an account isn't sufficiently liquid/trustworthy?

posted by _sirmissalot_ to Work & Money (29 answers total)

Well, for Ing, you're only allowed to get money out via a bank transfer (ACH), which generally will take a few days to complete. So it's not excessively liquid in that respect.

Ing is not a small company. I don't think you have to worry about your down payment being a large amount of money for them to transfer out or anything like that. Ironically, I would be more worried in that regard about a small town bank.
posted by smackfu at 12:54 PM on January 24, 2005

I have an account with ING and love it -- I've had no problems getting money, getting customer service, etc. There is lag time during transfers, though, usually 3-5 days between submitting a request and getting the money into an accessible account.

For me, though, that was a plus. It's easier to save when the money's harder to take out. YMMV.
posted by occhiblu at 12:56 PM on January 24, 2005

You can get over 3% APY on a 6-mo CD now, FDIC insured. Check bankrate.com for rate comparisons. Some money market accounts also have checkwriting.
posted by shoos at 1:04 PM on January 24, 2005

Another advocate for ING here. I have my primary savings with them, as well as a host of CDs. Very easy to use and I find that the waiting time for the ACH transfer isn't bad -- a few days and you have your money.
posted by xorowo at 1:15 PM on January 24, 2005

I have been using ING Direct for two years, they are amazing as far as my experience goes. A family member works for them and they are definitely brick and mortar in many regards, if you are scared of "internet banks."
posted by sled at 1:25 PM on January 24, 2005

I've have my Mortgage, a HELOC, and a savings account with ING DIRECT and I have no issues with them. The mortgage process with the was exceptionally fast and efficient and when they say no fees, they mean it. AND a great rate!
posted by dirtylittlemonkey at 1:30 PM on January 24, 2005

sirmissalot -- you are planning the same thing I did. It worked well and I still use ING.
posted by pedantic at 1:31 PM on January 24, 2005

I've been using online banks only for the past 7 years, including ING for the past 6 months or so.

There is a time lag getting money in and out of my Netbank account, unless I do wire transfers (which rock, although sometimes the bank on the other end charges fees). I am distressed by the lack of fee-free ATMs the last few years, but that can be gotten around.

With a little planning, it goes smoothly.
posted by QIbHom at 1:34 PM on January 24, 2005

Since the wife is worried about liquidity, I'm not sure a CD would make her feel more comfortable.

ING is fine. I transfer money in and out of my account several times per month with no problems. Dealing with them is very easy, their TOS is actually human-readable, and transactions always complete within 3 business days (which of course can stretch out if you hit a weekend or bank holiday) as they estimate.

If you need 24/7 access to the money, no it's not appropriate. But if you know you need the money on a certain upcoming day, remember that you can schedule the transfer in advance so that the money is automagically back in your checking account right on time.
posted by nakedcodemonkey at 1:47 PM on January 24, 2005

Response by poster: Thanks for the advice, all. The ING interest rate is so good that you almost suspect it is a scam. Good to have heard from some folks who've actually done business with them.
posted by _sirmissalot_ at 2:31 PM on January 24, 2005

We are exactly in the same boat (we moved our house down-payment to ING a few months ago). You set up the ING saving account and connect it to your regular bank account. Once you need it, you can transfer it back from ING. The wire transfer takes a day or two and we've had no problem with it. What we've done is to keep only a small amount (enough for the escrow deposit that accompanies an offer) in our regular bank account. If we make an offer and the seller accepts it, they can open the escrow immediately, then we figure we have a couple of days to move the rest of the money from ING.

We looked at CDs too, but most have terms where you lose most of your interest if you withdraw in the first six months of opening. If you withdraw early, you'll lose a lot of the interest and will end up doing no better than the MSR (mattress savings rate).
posted by fubar at 2:43 PM on January 24, 2005

The ING interest rate is so good that you almost suspect it is a scam.

Well, you do need to keep a relatively high minimum balance to get the good rates that ING advertises. I get the same interest rate from my credit union, and many money markets offer even higher rates.
posted by AlexReynolds at 2:49 PM on January 24, 2005

I'll give another vote for ING. I use an account there to hold money for my auto and home owners insurance and also property taxes (I choose to pay those myself instead of paying into an escrow account with the mortgage company). I just put X amount in my ING account each time I get paid. When I get a bill for taxes or insurance there is more than enough time to move the money to where I need it. Better to make some interest on the money sitting there in ING than to pay it to some bank and make nothing.
posted by CJB at 3:01 PM on January 24, 2005

Well, you do need to keep a relatively high minimum balance to get the good rates that ING advertises.


Wrong. There is no minimum balance to hold an Orange Savings account, and there is no minimum balance to get the current 2.35% APY.

I've used the Orange Savings account for years with great success. The website is reliable and easy to use, and the bank transfers always happen within 3 or 4 days.
posted by rxrfrx at 3:08 PM on January 24, 2005

You might also look at these guys, who are offering 3.0% right now.
posted by kindall at 3:16 PM on January 24, 2005

I've had accounts with ING for years, I've never had a problem. They're easy to deal with, their interest rates are (very) high if you're saving with them and low if you're borrowing from them, and I see the fact that you have to do a bank transfer to get your money (normally less than 24 hours in my experience) as a plus, since it makes you less likely to spend money you don't really need to spend. They get a big thumbs up from me.
posted by biscotti at 4:24 PM on January 24, 2005

QIbHom, if you are looking for fee-free ATMs, see if there is a WaMu (Washington Mutual) branch nearby. They offer no fee for use of their ATMs. Also, local credit unions often have low- or no-fee ATMs, even if you are a not a member.
posted by PadrePuffin at 5:39 PM on January 24, 2005

One caveat about electronic banks: good luck trying to link your bank account to PayPal. I set up an account with NetBank, and while I'm pleased with it in general, the fact that PayPal can't/won't deal with all-electronic banks is a bummer.
posted by greatgefilte at 5:41 PM on January 24, 2005

ING Direct is somewhat independent from ING Groep N.V., the parent mega-banking-corp. They operate with little interference from above as a startup operation, and they have a pretty cool business model: provide a few simple loan options and a few simple savings options that all cleverly have the same turns (at least this was true in the early days, they seem to have branched out some since). So without dealing with the overhead of branches, or maintaining hundreds of banking products, they can watch x% interest come in on a loan and pay out (x-1)% on CDs for the same term, and make a profit before they even deal with the secondary and investment markets. (Caveat: this information came from the sales team of a company I worked for that viewed ING Direct as an excellent prospect for our product--shortly before we went under. So a grain of salt is probably in order.)
posted by PadrePuffin at 6:05 PM on January 24, 2005

The ING interest rate is so good that you almost suspect it is a scam.

It's pretty closely tied to the federal funds rate, which has been going up quietly for the last year. A year ago they were giving 1 or 1.25%. Which was actually good at the time.
posted by smackfu at 6:29 PM on January 24, 2005

There is no minimum balance to hold an Orange Savings account, and there is no minimum balance to get the current 2.35% APY.

Mea culpa. "With an Orange Savings Account, you earn a variable 2.35% Annual Percentage Yield (effective 12/27/04)."

Looks like they changed their policy a few weeks ago.
posted by AlexReynolds at 7:12 PM on January 24, 2005

Looks like they changed their policy a few weeks ago.

No, that's when the current APY was put in place. There's been a single APY for all Orange Savings customers, no minimum balances, since I first signed up (about 3 years ago), as far as I can remember.
posted by rxrfrx at 7:38 PM on January 24, 2005

Also, I believe they were paying a solid 3.0% when I first signed up. It dipped but it's been going back up.
posted by rxrfrx at 7:39 PM on January 24, 2005

I like it. The 'hard to get money out' factor is neat (although I still find it hard to save. And here we get slightly better rates.
posted by bdave at 7:55 PM on January 24, 2005

AlexReynolds: No, that's been their policy for years. When I opened my account almost two years ago, I had several months where the only thing in it was $5 and my $25 referral bonus. Still earned full interest.

I also have an account with their British affiliate which earns a whopping 5% APR (or AER as the Brits call it). Woo-hoo!
posted by grouse at 12:58 AM on January 25, 2005

I use ING's Canadian affiliate, and I've been completely satisfied with them. I used the account to save for my down payment as well. The interest rate is variable, and I've seen it go up and down, but it's been consistently higher than anything comparably liquid from other banks. If I had a lot more money than I do, I'd get a redeemable term deposit, but you don't get good rates on those unless you have a good chunk of change.

They have phone service as well, which I've found very helpful. You can easily speak to a real person, so that helps me feel more secure. Hell, my grandfather started using ING before I did, and he hasn't had any problems either.
posted by raedyn at 7:20 AM on January 25, 2005

NetBank is expanding its fee-free ATMs by the way. Visit netbank.com and then I think it's Tools, and then the ATM locator ( I<3 NetBank). And, if PayPal wouldn't be so fraud-ridden . . .arugh, nevermind, that is another argument altogether. In any case, with online banking, remember that if you are moving your primary banking functions to it, that it is not for those who live paycheck to paycheck and need money to go right in and then come right out. There is simply too much of a delay inherent in the system when you don't have a branch, unless you have direct deposit. And, be sure to read the fine print. Banks are required to disclose the fee schedule, funds availability, etc to you upon your application. If you don't avail yourself of the information, then you're just asking for a problem.
posted by Medieval Maven at 8:34 AM on January 25, 2005

I've also had an ING account - they're very reliable.

But I've switched over to NetBank now, because I wanted more liquidity. If I need money, I can transfer it online from my savings to checking and it's available immediately. Or I can have the savings linked as an overdraft protection account for the checking.

ING has slightly better interest rates (I think I'm getting 2% at NetBank), but it doesn't offer checking, which can make a difference if you need liquidity.
posted by chundo at 9:19 AM on January 25, 2005

Padre Puffin, thank you for the suggestions. I'll have to wait until I get home to check the Yellow Pages for WaMu branches, since their website locator is broken. If I can find one, that would be wonderful. The local banks screwed the credit unions so badly that their ATM fees are higher than many of the banks' fees.

But, I can get cash when I grocery shop, and NetBank is supposedly building their own ATMs.
posted by QIbHom at 4:36 PM on January 25, 2005