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Ally Bank Savings Account Review

by Flexo on May 29, 2009

in Banking, Reviews

Ally Bank Savings Account Review4.353

See the review of the best online savings accounts – updated August 18, 2009.

A brief history of Ally Bank and its parent, GMAC

In the turmoil engulfing General Motors there have been some changes related to banking. 51% of GMAC, which was originally established as a wholly-owned subsidiary of GM to provide financing for automotive purchases, was sold several years ago to private investors. GMAC branched into retail banking, offering savings accounts, certificates of deposit, and money market accounts with an arm of the subsidiary called GMAC Bank. More recently, GMAC became a bank holding company to take advantage of the Troubled Asset Relief Program (TARP), receiving $5 billion from taxpayers through the government.

At the same time, General Motors, which still owns 49% of GMAC, continued to founder towards bankruptcy. In an attempt to distance itself from the GM brand, GMAC Bank rebranded itself as Ally Bank, focused on offering a high-yield interest product, and began actively seeking new customers and depositors.

Click here to see Ally Bank’s current interest rate yield and apply for an account.

Opening an account with Ally Bank

I decided to become an Ally Bank depositor today. Before doing so, I wanted to be confident that my money would be safe amidst General Motors’ impending bankruptcy. Funds deposited with Ally Bank are insured by the FDIC up to the recently raised limits. I won’t come close to exceeding $250,000 in this account. The Treasury recently provided an additional $7.5 billion to GMAC, so Ally Bank’s immediate parent company is well capitalized at the moment.

ally1Here are my experiences from the bank account opening process thus far. As I visited the website to begin my application, Ally Bank warned me that I would need my driver’s license (or an alternate state or military identification number) in addition to my social security number to proceed.

Like some other banks, Ally performs a credit check to verify identity, but they may also reject your application if you are viewed to be a credit risk. The possibility of rejection based on credit history is unusual for banks, but considering this bank is owned by a financing company that has lately become a bank holding company and this type of structure might increase in popularity, requiring credit checks for bank accounts may be part a new reality.

It look less than two seconds once I submitted my application for Ally Bank to inform me my application was approved. Once inside this virtual gate, I was able to choose whether I wanted to receive paper or electronic statements. I always choose electronic to cut down on paper waste, and I wish more services would offer this option from the beginning.

Here’s another great feature. Like ING Direct’s subaccounts, I could create as many separate savings accounts, with their own account names and numbers, as I wanted. At this point in the initial set-up, I could also add money market accounts and certificates of deposit.

I set up two separate savings accounts, both to be funded electronically from my ING Direct Electric Orange checking account. Like setting up linked accounts at any other bank, I will be required to verify two small deposits to ensure I am the owner of the linked account. Options for a one-time initial deposit or a recurring automatic savings plan are available.

Ally Bank then required me to create my security settings for viewing my account information and activity online. The bank has combined most of the security features that have become commonplace over the past few years. I created a user name and a strong password, including mixed case letters and numbers. I selected some secret code words, an image I can expect to see each time I log in, and three security questions and answers. Ally also provides the option for registering the computer you mainly use for accessing the website to avoid repeated security questions at each online session.

If Ally Bank does not recognize the computer you are using to log into your account, they will send you an email with a single-use password to further confirm your identity. I have not seen this feature implemented anywhere else.

Using the Ally Bank savings account

Once logged in, I was impressed with the clean look of the interface. Click on the example below to zoom in.

Ally Bank interface

Ally Bank supports Intuit Quicken and Microsoft Money through Web Connect, which means you can log into the bank’s website and download your activity. At this time, you cannot automatically download your Ally accounts’ activity through Quicken directly (”Direct Connect”). If you like Excel for reconciling your account, Ally offers a flat comma-separated values spreadsheet for download.

Transfers among your Ally accounts, and between your Ally accounts and your linked bank accounts, are free, but keep in mind that savings accounts and money market accounts are limited to six withdrawals per period.

Ally Bank charges no account maintenance fees and there is no minimum balance. If you exceed the six withdrawals mentioned above, Ally will charge a $10 fee. Cashier’s checks and wires carry an additional cost. A returned deposit item, if a check you send bounces or if you don’t have funds in an external account to cover a transfer, will cost $7.50.

The bank is also drawing attention to their 24-hour customer service availability and the plain language used throughout their website. I have not yet worked with Ally’s customer service, but I will be sure to report any future frustrations.

Conclusion

Opening my account with Ally Bank was painless and quick, and I like how the website operates so far. After my initial deposit is transferred, I will have a better idea of how quickly funds are available and can be transferred back to external accounts. I will return with more information at that time.

The main question I have moving forward is how long Ally Bank will be able to maintain their position as one of the highest among high-yield savings accounts. Bank have long used high interest rates to lure new customers only to drop the rates when they become confident in their position as leader, like ING Direct, or when the bank changes ownership, like Washington Mutual.

The American Bankers Association (ABA) sent a letter on May 27, 2009 to the FDIC requesting that Ally Bank be forced to lower their deposit interest rates, citing the bank’s unfair competitive advantage. It is unfortunate that the ABA would take this stance with savers forced to settle for interest rates that will not reach the rate of inflation going forward. The ABA has since removed the letter from the organization’s website.

Like I said above, I am not concerned with risk to the liquidity of my deposit despite Ally Bank’s association with GMAC and General Motors. If the worst happens to General Motors, Ally Bank should remain relatively unaffected.

If you are interested, apply for an Ally Bank savings account here and let me know about your experience by commenting below.

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Rating: 4.3/5 (3 votes cast)

Tagged as: ally bank, Banking, gmac bank



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About the Author

Flexo, the owner and creator of Consumerism Commentary, has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow him on Twitter.

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  • Jill
    It is hard to imagine that a person can say nice things about their bank. However, after 5 months, I can safely say that I am sold on Ally. Unlike Chase and E-Trade, they actually cared about me as a customer. So I have closed my accounts with other Banks and have transferred my money to Ally.
  • Tom
    I had to fax in some documents to get an initial account set up as well but everything has worked very smoothly after that. You can usually get someone on the phone in seconds unlike the other banks where you have to hold endlessly. I would recommend Ally based on my experience.
  • While Chase is not an online bank, they do have the same safeguard regarding not allowing me to log on if the computer I'm on isn't recognized.
  • Tom
    You mentioned the credit check for opening an account -- do you have any thoughts on what they base the decision on? Is it the credit score. I am increasingly worried about the practice of using a score that favors debt as opposed to an assessment of actual ability to pay in general.

    I am aware of banks using Chex Systems to determine whether or not the consumer has issues such as frequent overdrafting that would clearly indicate how good of a bank customer someone would be. Even that has issues if it leads to someone not being able to get a bank account anywhere (I am not as worried about those who completely abuse banks, more about those who are in fringe situations that often occur with these types of reports and scores).
  • You mentioned the credit check for opening an account — do you have any thoughts on what they base the decision on? Is it the credit score. I am increasingly worried about the practice of using a score that favors debt as opposed to an assessment of actual ability to pay in general.


    It is my understanding that it is based on credit history. Without one, Ally Bank will likely not take your money. They may also base their acceptance on credit score. This is a different policy than most banks who base their decisions on Chex Systems ratings. There's no reason Ally Bank wouldn't use Chex Systems as well. It may be worth reading ToughMoneyLove's experience with GMAC/Ally Bank and their credit history policy.
  • Rev
    I have been an Ally (GMAC) customer for 3 years now. They have been nothing but good for me. The few times I have had to call customer service I was happy to find out they use American call centers and it was quick and painless to get what I needed. That is a huge bonus right there. Also their transfers to external bank accounts are usually very fast.
  • Mama
    Yes, they're fine if you're lucky and everything goes smoothly with setup and electronic transfers. Which it often doesn't with them. They tend to screw up transfers from external banks, often double drafting so that you end up with an overdraft at your external account. Do a search on GMAC Bank, and you'll find other stories about this. They are very inept, and will lie if it suits them. If anything goes wrong prepare for a nightmare and hours on the phone with them. You'll never be able to get the same person twice, and they don't do a good job taking notes on your situation for future CSRs to refer to. They could pay 10% APR on a CD and I still wouldn't deal with them again. If you haven't opened an account with them yet, run away. If you have an account with them, I don't know what to tell you--visit your local Botanica, buy some good luck voodoo charms, and pray that you never need them to solve a problem for you. They can change their name all they want, that doesn't change their negligence.
  • asa
    The whole bailout is so stupid on so many levels. Paying workers not to work, paying workers to quit, giving Chrysler to a company along with billions of dollars. This FAKE bankruptcy is a fraud by our US Treasury, among others. Anyhow, get ready to print some more money. This GMAC did not ever qualify as a bank. it was switcharoo and the Treasury has funded it completely. They have raise sqwaut funding except from our GOVEREMENT, otherwise nothing. Changing the name, FRAUD, magic trick, still same POS. All this trickery is making me ill.
  • Systar
    Mama, you are so right - I was looking to open an account and had some questions - below is the first paragraph of an e-mail I received. (The CAPS are mine for emphasis).

    Flexo - did they pay you for your review? If you do the most cursory review of their web site, you discover drop down boxes that overprint, choices that aren't clear, etc. An organization this big which doesn't care about its web presentation and whose CSR's can't write even basic English properly scares the hell out of me - I'm NOT transferring my money to them.
    Here's the reply:

    Dear Mr. H......,
    THANK YOU FOR BANK with Ally Bank. I would like to apologize for the frustration you have experienced with Ally Bank. I hope we are able to assist you now more effectively. After reviewing your account information I see that an external account for First Midwest Bank HAS BEGAN THE registration process................
  • AllyCustermer
    I have been with Ally (GMAC) for 3 years. I had no problem with GMAC before. Recently I spend 2 months in Ally and still can not open a new account, this experience is very frustrated. The customer representatives have inconsistent answers. One day they call you with one answer, and please don’t feel surprised for the call from them in the following days with another answer; I fax the documents to them, and they can not find/locate the fax. I am tired with several rounds of this kind of inconsistence.

    My question is:
    If representatives can NOT provide standard guidance/answer, what’s the meaning of customer service of the bank?

    Although they have 7-24 call service, it won’t help if they can NOT solve your problem. (In fact, it wastes your time!)

    I am searching for another bank with relative high rates. Enough is enough.
  • Sprouting out
    It's funny how some people can get on here and talk about the customer service of GMAC not which is called Ally Bank when the person writing the negative things cannot even spell. I work for the credit bureau and we tell people that whenever they call in and or go to the 3 major credit bureaus that if you put the security freeze on their report which to alot of people it is called the ID Theft alert lock on their credit report that they would have to call the bureau and or log into their account online and have the freeze moved temporarily so that the compeny will be able to check their credit. We even send that information to them when it is requested to the freeze put on their in the first place. With that being said no matter ow many accounts you have with Ally and when you decide to open another you have to let their bank operations department do their job to protect your identity or otherwise there is not point of freezing your credit report in the first place.

    Ally Bank has a representative there 24 hours a day 7 days a week, which I can't say that for alot of banks. The rates go up and down based off of the current stock market, if stock markets are down what makes you thing that you gon be a millionaire over night that is retarded. Or better yet why don't you invest into some type of stocks to get fast cash on top of what you are investing. Now you won't have to tie your money up for some time. I can appreciate Ally Bank straight forward thinking. And yes if it protects your bank image and gets the heat off of your bank then why not change the name, alot of companies do this including other banks. Why do you think that alot of these banks got either bought out and or merging with shutting the whole organization dowm.

    Some of you all are tripping over dum stuff. I have seen alot of people who are not self sufficent to work any computers but you have room to critcize the works of other peoplw within one organization when you are the ones who need help maintaining you thousands and thousands of dollars. $250,000 is covered under FDIC until 12/31/2013m please check ouy www.myfdic.gov to search any bank to make sure that they are FDIC Insured and it is even give you that bank FDIC#. With Ally Bank agents are there to attempt to insist you with questions not work a miracle for you.

    And by the way there bank operations departments handles transferring money to your other bank account and or funding the accounts for you, so the next time you all call up there and start fussing at the agents you need to fuss at your self ater all you choose that bank. They did not choose you and if you all want to go to another bank then be knowlegdeable and go do your research. I like Ally Bank because they have no mimium opening deposit and no mimium balance unlike ING and Bank of America.
  • Sprouting: I'd like to point that savings account interest rates are not related to the stock market at all. Most are loosely linked to the LIBOR, but it's a competitive market in itself where banks price their interest competitively against other banks. Also, ING Direct does not require a minimum opening deposit (unless you consider $1 a minimum) nor do they require a minimum balance.
  • Yoyo
    I'm finally out of Ally. Yay! I still had a CD that would have expired later this year, and since I'm moving this year I didn't 't trust them to send the money to the new address upon maturity of the CD. It's been my experience that you have to do a lot of handholding to get them to do anything properly. By your tenth phone call and three hours cumulative waiting time the CSR may finally succeed in doing what you actually asked for. Plus I've heard about the games they play ignoring your request and letting the CD renew automatically. So I decided to cut my losses and take the 90 day interest hit. It's more than worth it to be done dealing with this "bank" forever.
  • Don Ellis
    I urge you to cease using children in your commercials. The sleazy side of the way corporations operate today can be illuminated in a better way than your current ads provide.
    You have gone from GMAC to Ally - but if this is the signature pitch of your new brand - then your new name should be Alley. Try to get back into the open in your communications. Thanks for your attention to this message. Don Ellis
  • Hi. Nice post. Have you considered American express savings account. I think they are very good and have an interest rate of around 2.00%.
  • Ray Warren
    Just wish to point out some problems, I have had with Ally Bank. Wish to open a CD, called bank, spoke to a rep., told him I wanted monthly interest payments,mailed directly to me. Said no problem would be in packet of info,when account is opened. I opened the account with a deposit for the CD, got the info packet. No provision for payment of monthly interest to me on a direct basis. Callled, complained that I was misinformed and even gave the first name of the rep. Was told interest must be deposited into a bank account, not necessary to deposit with them. When I complained about the misinfo supplied to me and wish to cancel, they advised me that they would impose a penalty??? Now, it gets better!!!! The monthly CD date is the 24, THEY draw the checks on the 25. Hence, are they not using my money and God, knows who else, interest free. Now they advise that it takes 7 to 10 days, before I receive this late check. They are located in Pa., I am in NY!!!!!! Now the 1st Months interest is due, do not see it in my bank accoutant, etc. Call, up they are sitting on it, now will mail it to me. They did finally mail to me. I am not a happy camper with this bank!!!!!!!!!!!!!
  • Mark Nesbitt
    I just tried to open a high-interest savings account with Ally. VERY frustrating. They do not seem to be ready for business yet. I was opening a joint account in my and my wife's names. The online process failed and started giving me cryptic error messages. I phoned yesterday and spoke to a friendly person who said she would look into it, and would I hold? I asked her to give me a call back when it was resolved; she said she would. 24 hours later, no call. I phoned back, and spoke to someone else. He said they "have a big back-log" of issues to resolve, which is why no-one had called. After describing the history, then being on successive holds for 20 minutes, he came back saying that they required additional identify verification for my wife. We have been married for 10 years, at the same address, she has major-bank credit cards, accounts in her name with TD, a successful business, etc., but while the big banks are happy to do business with her (and LEND her money), as a result of whatever processes Ally is using, Ally is unwilling to TAKE our money without having her jump through "additional attestation letter" processes. The people were friendly, but Ally seems not yet "ready for business" and has some process glitches to sort through. My feeling is, if they are THIS hard to do business with up front (when we are trying to give them money), they are unlikely to get easier to deal with later on if we need service . . . kind of like a bad first date--accept the insight and move on. Is there a depositor's equivalent to "caveat emptor"?
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