Best 3-year CD rates pay up to 1.71% nationally

Clear piggy bank with coins 3-year cd rates

While no CD term benefited much after the Federal Reserve’s interest rate hike a year ago, 3-year CD rates have suffered the most.

The top nationally available 3-year bank yield dropped repeatedly after the Fed's first increase – and hasn’t shown any lasting improvement since the recent second hike either.

As usual, local deals from credit unions and community banks are still the best way to earn top dollar on your CD investments, up to 2.33% APY right now on 36-month certificates.

With the Fed’s second hike just three weeks into the rearview, we’re still hopeful some upward movement for 3-year CDs will arrive. But what about future increases? We'll spell out what we know.

The top national deals

For the last half of 2015, E-Loan towered above the competition for nationally available 3-year CD rates.

Not only did its 1.85% APY outpay the runner-up by almost two-tenths of a percentage point, but it was the best national yield we'd seen in almost four years.

Indeed, the lead for 3-year returns had sunk as low as 1.40% APY in 2013.

3-year cd rates

But E-Loan lowered its 36-month yield just a few weeks after the Fed’s first hike, and the national lead has bobbed up and down between 1.75% and a disappointing 1.66% APY ever since.

Today the top rate stands at 1.71% APY, offered by two banks. That’s after a two-week stint at 1.75% by Gulf Coast Bank & Trust, which ended Jan. 3.

Today’s co-leaders at 1.71% APY are State Bank of India-Chicago and EverBank.

State Bank of India-Chicago is a U.S. branch of India's largest bank and carries the same FDIC insurance as all the other banks we rank.

Based in Jacksonville, EverBank operates 10 branches in Florida but is more nationally known for its robust online operation.

We generally caution readers that EverBank is known for making almost weekly changes to its rate sheet, effective each Friday. Indeed, its 1.71% APY on 36-month certificates was unveiled this past Friday.

TOP 3-YEAR CD RATES: Nationally Available Bank Deals

Bank APY Minimum Deposit
State Bank of India-Chicago 1.71% $2,500
EverBank 1.71% $5,000
Bank of Baroda 1.70% $1,000
First Internet Bank of Indiana 1.66% $1,000
Popular Direct 1.65% $10,000
State Bank of India-New York 1.64% $5,000
TAB Bank 1.61% $1,000
Capital One 1.60% No minimum
Radius Bank 1.60% $500
Sallie Mae Bank 1.60% $2,500
Ally Bank 1.60% $25,000

Earning more with local deals

Fortunately, many savers can do better with a credit union or community bank, the best of which are paying above 2% on certificates of deposit in the 3-year range.

By tweaking your term by a few months, you can boost your list of options, resulting in more than a dozen deals below. You'll even find a couple offers that are available nationwide.

As always, eligibility requirements apply. So contact the bank or credit union directly to determine if you qualify.

TOP REGIONAL 3-YEAR CDS: Credit Unions & Community Banks

Bank States Term (in months) APY
Self Reliance New York Federal Credit Union New York 36 2.33%
Institution for Savings Massachusetts 36 2.25%
1st Gateway Credit Union Illinois, Iowa 40 2.05%
VITAL Federal Credit Union South Carolina 36 2.01%
Vibrant Credit Union Illinois, Iowa 33 2.00%
Advancial Federal Credit Union Texas, Oklahoma, Louisiana, New Jersey, Alaska 36 1.96%
Gulf Coast Federal Credit Union Texas 36 1.95%
Community Financial Services Bank Kentucky, Illinois, Indiana, Tennessee, Missouri 35 1.86%
Linn Area Credit Union Iowa 33 1.85%
NavyArmy Community Credit Union Texas 36 1.85%
RTN Federal Credit Union Nationwide 37 1.85%
Dayton Firefighters Federal Credit Union Ohio 36 1.80%
Lake Huron Credit Union Michigan 37 1.77%
Inspire Federal Credit Union Pennsylvania 30 1.76%
Crescent Bank Louisiana 36 1.76%
USAlliance Federal Credit Union Nationwide 36 1.76%
MidFirst Direct 11 states 36 1.75%
Asian Bank Pennsylvania, New York, New Jersey, Delaware 30 1.68%

Awaiting more help from the Fed

Whether you qualify for a local deal or opt for a top-paying national bank, you'll want to take advantage of these offers because they pay three to four times more than the current average return of 0.57% APY, according to our weekly nationwide survey of banks and thrifts.

The average fell as low as 0.43% in the summer of 2013, before beginning a slow but steady rebound.

Unfortunately, we're still a long way from February 2007 — before reckless mortgage lending plunged us into the Great Recession — when the average return on 36-month CDs was 3.8% APY.

The Federal Reserve's subsequent efforts to rescue the economy by pushing interest rates to record lows had condemned savers to pitiful returns for almost seven years.

Then a year ago, the Fed finally began what was expected to be a gradual process of returning interest rates to "normal" levels over the next few years.

But global instabilities in 2016 and an inflation rate that's still below its healthy target gave the Fed pause, with no further rate increases announced until its last meeting of the year.

In its Dec. 14 announcement, the Fed predicted raising interest rates two or three more times in 2017.

What remains to be seen is first, whether those Fed hikes will come to fruition this year, and even if so, whether it will move banks significantly off the dime in normalizing their own rate sheets.

Disclaimer: The rates above were gathered on Jan. 9, 2017. Check with banks and credit unions directly to determine eligibility for opening accounts, as well as to verify current offers.