13 Replies Latest reply: Apr 24, 2012 7:15 AM by crescentbeach4u RSS

    What type of payment is best? CC, Cash, Check, Paypal, Money Order???

    New Member

      Ok, I have been renting my vacation home for a year now. I only accept V/MC/D credit cards and have never accepted cash or checks.


      Am I losing business by not accepting other forms of payment? Are there risks with accepting cash or checks? Advantages?



        • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
          Active Contributor

          For me, cash is king.  By that I mean I'll accept personal checks, money orders, etc. I make sure my potential guests are aware of this at the getgo, and I tell them I think it helps to keep our costs and theirs down.   I just never wanted to pay the administrative costs associated with credit cards, etc.  By requiring payment in full 30 days prior to the arrival date, I think I have plenty of time to deal with an NSF check. 

            • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???

              My rental is in Paris, so I handle funds differently now (and agree with you about not taking credit cards).  But years ago, when I accepted personal checks, I would phone the issuing bank to verify if the check was good for the amount, then deposited it immediately. If there were multiple payments - deposits, downpayments, final payments - I still verified every check and deposited it right away, as the bank will only tell you that the check "is currently valid for that amount", and that could change in a heartbeat.  It only takes a minute to call, and takes care of any worries right away, instead of waiting 30 days and possibly having to deal with a bad check.


              The problem with accepting cash on arrival is that sometimes people "forget", or weren't able to access enough cash from the ATM, or couldn't get to the bank in time - and so forth.  Then, you have to be ready and able to deny them entry to your property.  I actually had to do this, once - definitely do not recommend it!

              • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                New Member

                Full agreement with you.

                A few have asked about credit cards but when you discuss keeping cost down....they just send MO or check.

              • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                thaxterlane Premier Contributor

                I'm not sure there is a "best" payment method.  I think the best method is whatever works for a particular owner and their guests.  The best method or methods can be determined by considering what the majority of your competition is offering and what the majority of your guests request.  Payment by personal or bank check is very common on the Cape and Islands where my home is located. I accept personal checks and bank checks.  I do not accept credit cards.   My guests have not asked me to accept another form of payment. 


                My rental books several months, if not a year, in advance.  Guest tend to book "their" week for the next year shortly after returning from the current year's visit.  New guests fill in by March for the summer season.   I deposit checks when received and have only had one returned in over fifteen years.  This renter was required to submit a bank check and pay the fee charged to me for return of their personal check.  When I have a last minute booking (anything less than 30 days in advance) I will only accept a bank check.   These bookings tend to be for the off season which is far less popular and books much later in the rental cycle. 


                I would advise against accepting credit cards because of the ability of the renter to dispute the charges which could, I imagine, lead to the funds being held up for a period of time or, in a worst case scenario, returned to the renter.    An owner that has experience will be better qualified to comment on these types of problems.


                My bottom line:  I want the funds paid under my control, not controlled by the renter or a third party.


                I have never had a request for a refund or adjustment during or after a guest's stay that has caused me to feel this way - but it appears some owners have had troubling experiences as related on this and other forums. 


                Good luck!

                • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                  anja Senior Contributor

                  Hi bhughes.


                  There really is no ‘best’ way to accept payment that will offer EQUAL protections to both the traveler and the owner.  And, for security, all methods have risks. We operate in an unsafe world. I have discovered, after using several different methods of payments, that there is no best way...they all have fees, constraints and security issues. Cash in king...{I mean hard cash}...but it's not easy to deal these days in cash {only}.


                  When I first began my rental business, I did not offer payment with credit cards. I was only accepting checks. After the first year, I considered that I might be losing bookings if I didn’t diversify my payment options.  My Confession: I really don’t like credit cards…but most people do not feel as I do.   So, I decided to offer payment with credit cards via third-party processors.  There are fees involved for just about every form of payment these days, in any case. Also, because I advertised overseas, I also had gotten requests from prospects overseas to pay me directly via Swift Transfer {bank to bank} so I then expanded my payment choices further to permit the bank transfer {dreaded by many here}.


                  So, for the past 5 years I have been offering 4 payment methods ….NONE of which do I IMPOSE on anyone…for example the "bank transfer"....it is the choice of my guest …so the "bank / swift transfer” is  only used when guests REQUEST it.


                  In 5 years, I have NEVER had a single problem with anyone’s payments to me.   Here is my list of 4 choices as listed in my payment policy:


                  To Send Reservation 50% Deposit –or- 100% payment choose one of the following methods:

                  1. By personal check in US$   from a US bank.

                  2. By certified bank check  /  international bank draft in US$

                  3. By bank transfer of funds – Swift Transfer – from your account to our account

                  4. By credit card:  using PayPal.com,   or  Google Checkout, or Intuit.


                  The majority of my guests want to pay with credit cards  and checks. For credit cards, most of them choose PayPal.   Do I like this?  Not really - although it's an easy transacation!   I don’t like credit cards -period-…I don’t even like PayPal, Google Checkout or Intuit that much for my business because of all the fees being charged to both parties.  Most people feel “safest” using credit cards to book a vacation rental, so I'm going with the flow so I offer what my guests want.


                  For the past 5 years, since I diversified, the above 4 choices that I give my guests to pay me have  resulted in –ZERO- problems for both me and for them.  {I knock on wood.}  One thing that I believe is a “selling point” for PayPal:  when I tell my guests that their credit card number and bank account details will never be revealed to me {or anyone}, they like that.  Of course…they feel secure.  Now, if you are the type of Owner that wants to hold a credit card number in case of property damanges, than PayPal is not for you...because you'll never see the guests' cc number. But, at least the guests don’t seem to care whether  I have a merchant account or not as long as they get to use their credit cards.  With PayPal, my guests can also “transfer” funds directly from their bank to my bank, again, without revealing their bank account details. PayPal is pretty secure method of transaction...it's just not protective of the Owner...so be aware of that.


                  Now, it goes without saying that before we get from the inquiry to payment, I spend a bit of time “fostering” trust between us during the “getting aquainted” process, as all Owners have to do. My payment terms are pretty standard:  50% deposit to secure the reservation   -and-   50% balance 30 days before arrival.  So, the 30 days before arrival is sufficient for any problems with a check to appear and be resolved. But, I haven't had any problems with checks.


                  I’ve used PayPal for years now for both national and international payments and I'm okay with it. {I have a PayPal biz membership used ONLY for guests’ payments. I immediately transfer the money out of PayPal and into a separate bank account where I hold the traveler's money}. Google Checkout and Intuit are also free to sign up for, but they also have weaknesses,  too. PayPal will not protect the Owner if something goes wrong with the rental experience and the guests wants to get all their money back. But, that is the same weakness that accepting credit card payments has for the Owner --- a guests can request a charge back --- easily --- and the Owner has little recourse ---- under some circumstances that the Owner has solid documentation over, I understand the charge back can be challened, though...and sometimes won when the evidence  by Owner is solid. You have a lot of experience with credit cards. You know their strengths and weaknesses better than I -- I do not use a merchant account.


                  Obviously, you have to do your due diligence by examining all the different ways to accept payments - whether they are from nationals or international guests. You learn what suits you best by trying a few.  But, you'll soon discover that there are pros and cons to all payment methods. You can just open a free account with PayPal in minutes to check them out… {not so with Google Checkout or Intuit…they have to approve you before you get access}. Examine all the details...the way it operates...the fees....the resolution/dispute center...customer/buyer protections in particular, etc..  Using PayPal to handle your rental payments for a "service you are providing" will not be treated by PayPal as the same for "tangible items that are shipped to a customer"....when it comes to coverage and disputes, etc.  If you open a PayPal account just read all the fine print inside.

                  • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                    swlinphx Premier Contributor

                    Has anyone tried the new FlipKey Traveler Advantage reservation management & billing system?  If so, how does it compare to HomeAway's Reservation Manager and who is the processing company?  Is it VacationRentPayment also?  Am curious to hear some feedback, thanks!

                    • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                      New Member

                      We started out taking checks only.  It worked out OK but it meant regular trips to the bank, down the mountain from us. 


                      I like a simplified system, and am willing to pay the credit card fees so that I can conduct my business literally form anywhere, any time. It's a big time savings not to go into the bank, especially considering the driving time involved. 


                      Another plus is the paperless aspect.  It's easier for me not to have to keep track of checks. 


                      And perhaps best of all, the confirmation is within minutes or even during a phone conversation, so the traveler knows the booking is secure.  This is all why I prefer credit card or debit card payments to anything else. And so do most travelers. 

                        • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                          swlinphx Premier Contributor

                          Oh, I can't imagine doing it without checks now (at least for the deposit).  We still give them the option to mail the rental by check because there's time to see if it clears and then they avoid the fee.

                          • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                            amyg Active Contributor

                            We've taken mostly checks since 2002 and it's worked well for us.  It takes more effort, yes...copying checks, taking them to the bank and send a payment confirmation email to the guests, etc.  But like thaxterlane said, when you have cash, you have control.  I have shopped around for the most economical merchant account and I'm happy with the 2.5% discount and no monthly fee program offered by PayPros (formerly known as PPI) that let's us offer Visa/MC/Discover for guests who need to use a credit card. 


                            I don't mind the extra work associated with taking checks, but I would guess that I'm in the minority on that.  We save several thousand dollars a year by taking mostly checks for our 4 properties, so it's a nice savings.  And with the economic downturn, I'm finding more people are really open to paying by check or money order instead of credit card.  They've paid down their credit cards and don't want to run them back up again!

                              • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                                swlinphx Premier Contributor

                                Actually, a lot of people request using a card in order to get their "bonus points".


                                So I understand what you're referring to, how do you save money by not using credit cards for something like a refundable deposit, where you need to know they are confirmed right away before denying other inquirers?  Do you wait several days to receive a check in the mail and then another few for the check to clear?  Now that would cost us a lot of money in missed rentals!


                                I forgot another thing:  for international travelers it is often difficult and complicated to get checks drafted in USD and sent for the rental alone so they choose a credit card and pay the fee.  And that's for the rental; I can't imagine them paying a deposit to reserve the place with a foreign check.


                                I still haven't heard exactly why anyone doesn't want to use credit cards for the deposit and I'm trying to understand all the adamance.  I can think of so many reasons why a credit card is better though.

                            • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???

                              So glad I came across this thread. 




                              We own and manage many rentals and prefer Payment by check or wire transfer.  We have been renting for over 2O years and have learned a thing or two.


                              Almost all of our international travelers pay by wire. (over 50% of our business) Many of our U.S. customers pay by wire as well.  If an international guest pays by check, it must be drawn on a US bank and in US funds.


                              This is the only truly Secure method for us as Vacation rental owners.  We do accept limited payments by credit card via PayPal and charge a 4% convenience fee for this option.  If this does not discourage them from paying by credit card, the complications of using PayPal usually do.


                              WARNING! ~ We did make a mistake and agree to accept payments via SQUAREUP for a while.  Felt like they would be a cutting edge new company as they were founded by the same guy who founded Twitter.  Recently had a partial dispute by a guest who decided to leave early.  Even though we have a no refund clause in our contract,They were disputing $3000 of an $8000 rental.  Even before notifying us of the dispute, Square stopped depositing our funds and then froze our account, Holding over $50,000. THEY HAVE NO PHONE and can only be contacted via e-mail with little to no response. (A 10 BILLION DOLLAR COMPANY WITH NO CUSTOMER SERVICE AND NO PHONE!) It has been 2 months and they say they will hold those funds for 120 days.  Even though our guests have come and gone and have sent letters saying the charges were valid.


                              Over 10 years The few problems we have had has been with credit card transactions.  Any dispute has been decided in favor of the card holder no matter what our contract said.


                              FYI ~ Our solution is to file suit in Florida court.  Since most guests (almost all are from elsewhere) This forces to guest to hire an attorney in your city and travel back to appear for the case.  If they have no valid case, this makes them VERY willing to settle!


                              We are considering only accepting Checks or Wires as this is our best option to protect us as owners.  If the renter questions this, point them to the Carefree rental guarantee (which is pretty worthless) or Rental Insurance.  This typically makes all of our guest feel more comfortable.


                              One thing I would like to point out is that HomeAway is advising guests NOT to pay by wire since they now profit $$$ big on credit card transactions.  They advise traveler not to rent from owners that accept wires???? 


                              If a guest wants to rent from you and they are respectable, they will pay by check or wire and cover themselves with inexpensive travel insurance. 


                              Again, protecting the traveler and their own profits at the expense of us, their customers. So, as others have said, Europeans are very used to paying by wire and that is the best way to get paid by International travelers as THERE ARE NO CHARGE BACKS.  Most US customers have no problem paying by check and again NO CHARGE BACKS.


                              No one else with a say in weather or not you get paid for your hard work!  Good luck to all and hope this helps!

                              • Re: What type of payment is best? CC, Cash, Check, Paypal, Money Order???
                                Active Contributor

                                1.  Should you have two prices one for cash/check and then another one adding fees if a credit card is used?

                                •      What are the fees using HA BTW? 


                                2.  Should you have a higher posted rate and then if they ask to pay by check, give them a discount removing the fees?


                                3.  Should you have a higher posted rate and then if they ask to pay by check, take the extra profit?


                                4.  Do nothing and keep only accepting checks or cash which I have been doing?


                                It seems as if the people who only use cash or checks have way fewer issues than the ones that use credit cards. You read multiple posts here how people charge back, etc yet there are few bounced check posts.