any body accepting credit cards from tenants?

(please note this is not an adverstisment im just looking for advice)

  • been awhile since ive made a post ive been working for a credit card processing company (name will be unsaid) basically im doing outside sales letting people accept credit cards and saving them money on their rates (no bull) ive been trying to think outside the box and being into realestate i always thought that marketing to owners of rental property might be a great idea…

Pros would be the ability to have your money go directly to your bank account with the simple swipe of a card or punching in a number on a virtual terminal and it can be extremely affordable and inexspensive both from the equipment and fee stand point…

being a tenant myself my rent check is the only check i have to write and mail out or drop off and i find it to be a pain plus think of the costs associated with getting a new apt… lots of people can afford it but may not have security dep,first and last months rent, and moving expenses all in cash in the bank set aside all at once… credit/debit cards could give that opportunity to a lot of more than qualified people

we also do check services where we can let ya run a check like a debit card have the money in your account in less then 72 hours and the funds are guaranteed…even if it bounces…plain and simple landlords could get more rent checks on time and avoid taking people to court the dirty aspect of landlording we all must do at times but never want to…

sorry for the long post but id like some input…What do ya think? it makes sense to me but i dont own any major amounts of rentals or apt. complexes so i want advice from people this could benefit…all input would be appreciated and i do not wish for you to contact me about this service to the moderators im only looking for usefule feedback on a marketing idea

There are services out there that “debits” the tenants checking accounts for you for a small fee.

As far as credit cards are concerned, the thing that bothers me the most about this way is customers with a beef can always have “credit card charges” reversed, and it’s a chance that I wasn’t going to take.

As to paying a fee to guarantee checks, I tried that for a while at my business. I had tenants bouncing checks on me, but I was always able to have them make good on it, as the alternative is eviction, and I never saw the need for it. .

good point with the eviction notices… my feeling is that alot of times people wont pay up evicted or not and this is a way to keep you out of court and the hassles associated…

anyways keep the comments coming…

It a nice option in theory, but I looked into it before with some service and I felt the costs didn’t justify the benefits. I think it was something like $10 per month per unit. With 3 units, that works out to about $360 a year. I only get a deadbeat every few years so I don’t think it’d save me that much money and would probably even cost more than it would save.

ok… the costs associated are def. somthing i want to consider i can offer pretty low rates and even in some cases a package rate… equipment i can definetly do cheaply but over all i want people to feel like they are getting their money’s worth… i feel that the fact that you accept credit/debit cards might bring in a lot more tenants and offset some of the costs but i can understand how if you’ve survived with out it then it may be an unceccisary service… any ways more comments the better

Good post,

As President and CFO of a management company, I try to find ways to minimize costs to our clients. While a charge to run a tenant’s credit/debit isn’t something we want to incur, if it’s that or evict them, the $10 (or less) is a greater value.

Also, look at where the future of money handling is headed . . . debit and credit cards. We will very quickly get to where there will be no checking accounts or cash. Brave New World? On it’s way.

With credit card processing, we are ahead of the curve so our tenants have that option if they need it.

Hope this helps.


thanks cate… like i said if costs could be kept down (think 1.55 % +26 cents per transaction) or even .65%+30 cents for any debit transaction which is what ive been thinking i feel it would be a good opportunity to offer somthing other landlords typically dont… even raising rent on new leases 2-3 dollars would signifiacantly offset a lot of the costs involved with using a system… great and usefule feedback from everybody so far…

On the rents I get up here, 1.55% would exceed $10 per month, some units over $15 per month.

I think you basically have a solution in search of a problem.

When my tenants pay, it’s either by check, money order or cash. Those times I remember they couldn’t pay, I don’t think they had the credit or debit card to pay so it wouldn’t have mattered.

Actually if I was that worried about it or wanted to go hi tech, I’d do what another landlord I know does. He sets up a bank account for each unit and gives the tenant a debit card so they can go to any ATM and make a deposit however they like. He has it addressed to Current Tenant Unit #1. That way when they move, he doesn’t have to do anything. They get a statement in their mailbox every month. That’s their receipt that they paid. He has it set up so they can deposit, not withdraw. He also has it set up so that the money is moved out of that account as soon as it gets deposited. Doesn’t cost him anything to set up the account and he can check from home whether his tenants paid or not. This way there’s no excuses.

Yes, this is a solid idea, but you still need to get them to give you the Credit Card information. Ok, so they do that when the sign the lease, then 2 months in, they are maxed out or they cancel that card. If they are bad tenants, they are bad tenants.

For me, having their checking account debited is the way to go. I set it up to pull out the day their pay checks go in.

As to costs, just figure it in. What is your cost of driving to the property to get the check? What is your time worth?

good feedback… id still like to see if people in my area are interested as the situations are always gonna be different… as far as credit cards and maxing out i think the real message or pro ive been getting at is the power of payment options… plain and simple most businesses of anykind who dont accept credit cards are shooting themselves in the foot… more payment options and methods is one of the best ways to get customers however i understand this is more of a retail and service applied idea which is why i did this little post to see what the realestate guys think… id still like to persue it a little but i think i have a good idea of what problems would be and if i cant address them then my services probobly wont be right for the merchant…

I own a business where we do over 25K a month in credit cards for big ticket items. No doubt we’ll lose the sales if we don’t accept them. But I don’t do it for my rentals.

I pay 1.75% discount for Mastercard and Visa, and 3% for AMEX. If the rent roll is $10,000 a month, the discount fee would run $175.00/month, or almost $2,000 every year.

And I was shocked that if it’s a “corporate” mastercard or visa, I get banged extra, paying almost 7% in fees total for a sale. This extra is hidden in the monthly fees. The bank tells me this is because the risks are higher. But, I often can’t tell it’s a “corporate” card, nor am I allowed to charge more because of it.

Do I want to get hit with $70.00/month in fees on a $1,000/month rent if a tenant pays with a “corporate” card?? Ouch!!

And the thing about credit cards is every so often, a joker would complain months after the service demanding his money back. We would have to send letter back and forth with the service provider, or else the charges would be reversed.

I hate to think that a joker would ask for his January rent back because I couldn’t fix his toilet fast enough.

The other thing is I understand the mentality of many credit card users since I was in credit card collections the first job out of college. They’ll have to make sure they set aside enough money each month to pay the credit card part of the bill for the rent. In other words, if the rent is $1,200/moth, they better make sure they pay at least $1,200/month to the credit card company. You think they have the discipline to do that??

In my book, NO.

Why not pay me the $1,200 instead rather than pay $500/month to the credit card company, and maxing out in a few months, then come up with a BS story reversing the charges. No thanks.

I wish my LL took CCs…oh the points I would get. I have a lot of my bills including cable, internet, car note, phone service, 800 number, gym membership, etc all going to one of my points CCs. I get a ton of dollars back in rebates. It’s also been easier for me in terms of keeping my checkbook up to date, instead of have line items for all of those I just have a couple of credit card payments a month to keep track of.

Rich, I agree the points and bonuses are nice. Except, as the LL accepting the cards, I’m the one paying for all these freebies.

I don’t believe entirely the bank’ stories about all the risks involved in doing “corporate” cards. They’re banging me for all the freebies they’re giving away.

In reality though many small businesses fail I would see a personal card as far more risky than a business card. I guess they are just hitting you for all those frequent flyer miles.

Rich, did a quick calculation. A tenant paying me $1,000/month rent with a corporate card, I can be hit with $50/month in surcharges, on top of the usual 1.75% fee,or $17.50/month.

He’ll rack up nice bonuses, miles, while I’m stuck with $840/year in fees, paying for his vacations.

I think the banks are real sneaky bundling this into the monthly fees, and had I not called to find out, I wou’dn’t have known. And the reason I called was more and more people are getting corporate cards, and the fees are getting out of hand.

Like I said earlier, a solution looking for a problem.

Landlords are different than merchants because merchants rely on impulse purchases as part of their sales. Not accepting credit cards kills those impulse purchases. You don’t have that situation with a rental, it’s something they have to pay. Why increase their costs and your costs by introducing a third party that just increases costs?

if i were you frank i would look into switching companies… 7%??? thats outrageous!! i havent come across anything like that so far there are set standard rates for mid-qualified cards ( a lot of those bonus and rewards cards) but they are not bad just usually not adjustable or quite as low as say a debit transaction… thats the problem with bank they base your rates on a bunch of bull like risks etc…they have the upper hand in charging rates because basically people knock on their door lookng to accept credit cards…the company i work for is an ISO of a major bank (will be unsaid) yet we can charge very low rates…

this is an ULTRA competitive business so frank shop around you’ll practically have people jumping through hoops to save ya money and in a lot of cases keep the same checking account adn equip. you already have…


While I certainly agree with Cate’s observation that we are headed for a cashless society, I wouldn’t do it personally for the reasons that Frank and Henry laid out. There are a percentage of tenants who are nothing more than crooks. They wouldn’t think anything of reversing the charges, using a stolen credit card, etc. When I pick up the rent in CASH, I know it’s going to be good (after I check it with my counterfeit pen). Plus, there is little enough profit in rentals. The very last thing I need is someone else taking 3%, 5%, or 7% in needless fees.



The extra charge has nothing to do with me.

My merchant service provider, namely a subsidiary of JP Morgan Chase, charge me a base rate of 1.75% for Mastercard and Visa, less for debit cards. When a customer charges, the discount is deducted from the charge. I pay 3% for AMEX, and something in between for Discover.

Being a competitive business, I constantly get pestered by other providers willing to do MC and VI for 1.5%.

But, I started getting mysterious charges at the end of the month. I found out they are additional fees for folks charging on “corporate cards”. They tell me that when someone has a “corporate card”, the risks associated with that card is a lot higher, and the “customer’s” bank passes these additional costs to me, in many cases, another 5% of the total charge, on top of the 1.75%.

In other words, I get banged for this no matter what service provider I use.

I also see a lot of perks associated with these cards, and I beleive really the cost for those are also passed thru.

In fact, I operate thru several entities, and I myself receive solicitations in the mail, 25K, 50K approved lines, just with my signature. How creditworthy are my corporate entities?? If I charge on it, and not pay, then who foots the bill. Not me!! Not many of them ask for my guaranty.

I spoke with other merchants who do not review their bills and are shocked when I told them of these outlandish charges.

If you are in this business, I appreciate if you can find out more about this issue as it really sticks in my craw.

Quick point addressing bigb’s original question from a renters persepective. As much as I would love to get credit card rewards for paying my monthly rent, the actual monetary value of those points is pretty negligable (I think less than 1%). Credit cards are definitely a convenience, but if I find an apartment that meets my requirements (location, price, amenities, etc.), I wouldn’t pass it up because I can’t pay by credit card.

Of course, I always pay my bills on time, so I may not be the best example of someone who would let credit cards be a major factor in deciding where to live. From a landlords perspective, I don’t think you’d want to rent to a tenant who will choose your apartment because paying by credit card will allow them to defer paying their rent…I think you would ultimately attract lower quality tenants.