BEWARE: E CHECKS!!!
Very timely discussion regarding e checks. I have spent several hours bouncing back and forth between VacationRent and Homwaway.
I have STARTLING news to share with EVERYONE that uses the credit card option through Reservation Manager.
3-plus weeks ago, a guest paid their $2450 deposit via e check (I didn't know payment was via e-check...assumed it was credit card) to reserve one of our homes. 24 days later (and with having turned away one other potential guest for that same week) I get notice from Homeaway that the funds were being deducted from my account via "payment reversal".
I contacted Vacationrentpay who told me I had to handle through Homeaway. Got Homeaway on the phone and they said I should be speaking with VacationRentPay.
Eventually, got both companies on the telephone and they determine that because payment was made via E check neither VacationRentPay nor Homeaway has any ability to stop the reversal...their suggestion is to hire an attorney.
My next step was to eliminate the E check payment option on my property listings...VacationRentPay tells me that yes, it can be done but through the Dashboard/Homeaway. Got customer service at HA on the phone and they inform us that you CANNOT deactivate E check acceptance...if you offer credit cards then you offer e check payment.
Bottom line: if you use VacationRentPay (through HA/VRBO) for credit cards, you HAVE to accept E checks.
This opens up all of us homeowners to a tremendous liability...E checks provide only the same "protection" as regular personal checks: any reservations made via e checks can be cancelled at any time...EVEN AFTER THE GUEST STAY HAS CONCLUDED (the guest has 30 days after the echeck payment was made to initiate a "reversal".)
The homeowners' ONLY recourse would then be to hire a lawyer to try to recoup.
The dilemma : accept credit cards (and e-checks) and hope that more and more people do not learn about the weak security of e-checks and prey that most guests pay with credit cards! I am awaiting a call from the HA security people tomorrow and if they cannot arrange a method to allow us to choose if we accept E checks...bye bye!! Cannot afford to take any more chances with E checks...
RE: BEWARE Echecks
I don't want to sound naive, but if someone pays to rent your home and makes any type of payment that they then "reverse , after staying, would not that be a form of theft?
Has anyone experienced this, and what was the outcome?.
I hate to bother my attorney with a "what if" question, but guess I can. I'd THINK it would be considered a "theft of service", but since it is a real estate contract I'm not sure.
'I don't want to assume anything, but think it would be a civil issue, meaning you have to take the guest to small claims court. ( I can't imagine them showing up- which means you'd get a judgement , and could then ding their CC or bank account- and really mess up thier credit.) I'd think, if you received the payment at the address you conduct business, you'd be able to file the claim in that state/area. But, if it is all done online it might get complicated.
Look forward to hearing what others have experienced.
I think you hit it right on the head! If the guest pays with a credit card and you have documentation (either electronic or physical) that demonstrates the guest accepted the terms of your contract, you have a very strong chance to recoup any reversals through your credit card processor.
On the other hand, if payment is via a REGULAR personal check, once the funds have cleared into your account, the guest cannot "take back" their payment.
HOWEVER, and from experience, an E check does NOT provide even that level of protection. The issuer (the guest) can request their bank to reverse the payment for up to 30 days and it will do so through the credit card processor that handled the echeck payment.
POOF...money is gone. and then as you stated; time to get the lawyer involved etc. And really, a judgement is useless as a means to recoup your money...deadbeats will just live with the judgement and not care.
After a number of phone calls, we were able to get the floor manager at HA to eliminate the E check option from our properties. Now, the guest sees only one way to pay...credit card and the liability associated with having that E check option is gone.
Please pass the word along to others to consider removing the echeck option and maybe HA/VRBO can add the ability for us users to opt in or out via the Dashboard.
What is very misleading is the false sense of security that is portrayed by the HA/Vrbo message on the Reservation Manager payment page that limits acceptance of e-checks within 10 days of the reservation...it sends the message that once the echeck payment has been made and 10 days passes the payment is secure. ITS NOT.
Hope this helps.