Additional Fee For Rent Payments?

[webhopper]

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@Anonymous wrote:

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@webhopper wrote:

So, as a landlord, the only services that are available for me to accept CC payments with minimal fees charge 2.75% per transaction. As a landlord, I'm not willing to cut $41 off of my net cash flow for the tenant's convenience of paying with a CC. Now, they can use a ACH debit from their banking account which costs $5 per transaction. I gladly pay the $5 fee since it is convenient for me as well.

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this is what the landlord is doing, charging what it would 'cost' them to process the cc payment.

simple example:  $500 rent by cc incurs a fee of 2.75%** from the cc company, ergo $13.75 'loss' in revenue.  So charging $513.75 only results in a $0.38 'loss' (because now its 2.75% of 513.75, unless the landlord charges 3% = $515 resulting in a micro gain of $0.84 but this way covering any potential negatives)

** there is also a small 'per-transaction-fee', typically $0.15 or something.  If you want to learn how to nickel and dime someone to death follow the example of a cc backend processing company.

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If the rent at my property was in the $500 range, I could see charging a $5-$10 fee, but $41 is a bit excessive, and would negate any rewards received by the tenant. Like I said, ACH debit isn't too bad, minimal fees, very convenient. If someone wants convenience of payment, an ACH would be totally doable and I do in fact pay those fees as a landlord.

[Anonymous]

Just made two phone calls.  One to VISA who informed me that it is indeed a violation of their merchant agreement to impose a surcharge.

Another with the leasing company who basically said this:

We use a third-party company who charges us to process credit card payments and we are charging you (the tenant) the fee.  We do not have a merchant agreement with VISA so their rules do not apply to us.

By the way the charge is $36.

So although it's a ridiculous charge (from the tennant's pov) it is completely legal.

I was so excited about getting points back from paying rent with a CC.  Oh well.

[Creditaddict]

We certainly have been seeing many posts about paying rent and some about paying car payments... Santander allows credit card but it pushes you over to the 3rd party.  and 2.75% sounds like they are using something like Square.

Saying that Visa doesn't allow it seems... I mean you can send someone cash on paypal and it asks you do you want to pay the fee or the receiver pay the fee out of the money before it gives it to them... what's the difference?

I have always kind of aired on the side of I will pay fees to take income anyway someone wants to pay but when it comes to a car payment or a rent payment... The Owner has NO BENEFIT of paying a fee for you to pay with a credit card.... you are required to make these payments regardless so if you can't pay with check because you don't have the money I guess you get car repo or evicted from apartment.

[happy101]

I just found out that my apartment complex now accepts VISA,MC, and Discover. They only charge $14.99, but I don't know if it would be benficial to use any of my Reward Cards and still have to the $14.99.....

[Anonymous]

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@Creditaddict wrote:

We certainly have been seeing many posts about paying rent and some about paying car payments... Santander allows credit card but it pushes you over to the 3rd party.  and 2.75% sounds like they are using something like Square.

Saying that Visa doesn't allow it seems... I mean you can send someone cash on paypal and it asks you do you want to pay the fee or the receiver pay the fee out of the money before it gives it to them... what's the difference?

I have always kind of aired on the side of I will pay fees to take income anyway someone wants to pay but when it comes to a car payment or a rent payment... The Owner has NO BENEFIT of paying a fee for you to pay with a credit card.... you are required to make these payments regardless so if you can't pay with check because you don't have the money I guess you get car repo or evicted from apartment.

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Well I spoke with VISA directly and they said they do not allow merchants to impose any surcharges though it is legal for the merchant to offer a discount if you pay with cash.

I pursued this in the first place because my girlfriend told me the leasing agent said the CCC was going to charge a fee and that didn't make any sense to me.  I eventually found out that the leasing company was charging a fee.  Personally I'm not willing to pay ~8% of my total rent just to have the convenience of paying online.  I'll just continue to drop a check in the box every month.  Hell, I might start paying in pennies because they were so rude to me when I contacted them about it.

[Anonymous]

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@happy101 wrote:

I just found out that my apartment complex now accepts VISA,MC, and Discover. They only charge $14.99, but I don't know if it would be benficial to use any of my Reward Cards and still have to the $14.99.....

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Probably better to save the $15 unless your rent is so high that you get a greater reward back.  I thought about paying several months in advance, but the $36 fee far outweighs the 1% reward I would get.

[happy101]

Yea, I am trying to crunch all my reward cards to see if it is worth it.... I believe if I do decide to do it may be beneficial using my Chase Marriott Sig Card..  I am still deliberating on that.....

[Anonymous]

this wouldn't work with cashback rewards IMO

the only possible benefit would be Amex points since you get a point for every dollar used.

[bribro]

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@Anonymous wrote:

this wouldn't work with cashback rewards IMO

the only possible benefit would be Amex points since you get a point for every dollar used.

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Not even MR points would make it worthwhile with most fees. In my case, I would have to get 7% cash back or so to overcome the fee. Not worth it, unfortunately.

[Anonymous]

I am lucky my landlord accepts credit card payments, no extra fees. There is only one option to pay your rent every month though, walk into the office and pay by credit, debit, or check. They only accept Visa or Mastercard. Presumably because merchant fees for Discover or Amex are just too high.

I will have to ask them of course but I believe the large majority of tenants pay by check or debit card. Us credit card rewards junkies are actually a small minority of the population. There is a good segment of the population who refuse to get a credit card under any circumstance. Credit cards are the devil. Then after that most people who do have a credit card have a no frills or sub prime card that doesn't charge as high of a transaction fee, and even then for most of those people they still only use cash and debit for everyday purchases. The people who charge everything on a rewards card are actually a small percentage of the population, and even fewer people have the credit profile for the prime rewards cards like Amex revolvers and Chase sapphire.

One thing is certain since rent is my single biggest monthly expense and this year I just started paying my rent by credit card at the end of the year for christmas I definitely have to buy one of those popcorn tins and drop it off in the office to show my appreciation for accepting credit cards with no additional fees. I figure it is the least I can do for getting rewards to pay rent. I have to continue to hope the majority continue to pay with debit or check. If everyone put their rent on a credit card I could see the merchant fees being too much to bear to the point the landlord has to increase rent to cover the costs.