Hudson City Savings Bank (OTC:HCFB) which serves the Connecticut, New Jersey and New York markets, is now offering some of the best CD rates in America, paying out 2.50% APY on 24-month certificates of deposit and a 3.00% APY on 36-month CDs.

As far as I’ve been able to find, there are no other banks that offer higher CD rates than this, although Flagstar Bank is offering the same interest rates on their 36-month CDs.

Here are the current terms of the CD as of this writing:

• 3.00% APY 3-Year CD ($5,000 minimum balance)
• 2.50% APY 2-Year CD ($5,000 minimum balance) 
• 1.75% APY Internet Money Market Savings ($2,500 minimum balance)

If you want to invest in the 3-Year CD, it’ll cost you $5,000, but if you live in the three states Hudson City Savings Bank serves, you can get in as low as $500. 

There are no other local limitations, and you can apply for the CD at the national level, i.e. it doesn’t matter where you live in the U.S., you can get in on the great interest rates.

Hudson City Savings Bank has been named as “The Most Efficient Bank” more than once, which allows them to offer better rates than the majority of their competitors, as you can see with the CD rates I mentioned here. They have 125 branches in the 3-state area they physically operate in.

CDs acquired from Hudson are insured by the FDIC for up to $250,000 until the end of 2009, where, along with all banking investments, will revert back to the former $100,000 per customer, unless that is changed. For now that is the known circumstances concerning insuring all banking accounts under the FDIC umbrella.

Do go to the bank’s web site to confirm the CD rates, as then can change quickly. But as of October 2, the CD rates stand as I’ve written here.