If a customer wishes to withdrawal just the interest earned on their Time Deposit, is it subject to a withdrawal penalty?

EX: Deposit of $6000 on 3/17/05. 12 month term with auto renewal on 3/17/06 for $6200. Customer wants to withdrawal $375 on 3/1/07 - says that it is just "interest." Current balance is $6375. What amount is subject to the early withdrawal penalty of 6 months interest?

Thanks for you help.

The abilty to withdraw interest and when, and if a penalty will be involved should already be addressed in your account agreements.

Our bank does allow for interest withdrawl mid-term without penalty on terms of six months or more, but the interest must already be posted to the account. We will not allow the withdrawal of accrued only interest, until it is credited anyways. Also, once the CD renews, and if the customer did not withdraw the interest prior to the end of the grace period, we then consider that renewed interested as renewed deposit. Thus, in the scenario you have presented above, under our account agreement, the customer could today withdraw $175 without penalty.

But again, this should already be addressed in your account agreement.

We do it the same way as bbsgrant