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Renting A Car With Debit Card

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Jim Waiting At Dollar Car Rental on Kauai, HISome friends and I were recently discussing rental car strategies, one of them was planning a vacation to Hawaii, when the subject of debit cards came up. None of us had ever rented a car with a debit card before (we did begin our personal finance development in the era of free and cheap credit after all!) and that was the only card my friend had! To be honest, I didn’t think it mattered if the card was a credit card or a debit card (and I erroneously said so!), but I was wrong.

I usually advise against the use of debit cards because the card is linked directly to your bank account. One erroneous or fraudulent charge can have a cascading effect that generates an avalanche of fees and penalties. I’ve read and heard many a story of a dozen insufficient fund fees and low balance fees following some key-in error, it’s terrible.

Anyway, it turns out that renting a car with a debit card is a big pain in the ass. The reason is because your “credit limit” is really the funds within your account, unlike with a typical credit card. The end result is that many companies will tack on a “reasonable premium” to cover the rental period and potential overages such as fuel and damage to the vehicle.

For your convenience, here are the policies of major companies:

  • Hertz: You can reserve a car with a VISA/MC debit card and a hold will be placed for an “estimated amount of the rental charges plus a reasonable amount to cover any incidental charge.” No mention of what “reasonable amount” means though.
  • Enterprise: Policies appear to vary from location to location so you’ll have to call the rental site for actual requirements.
  • Budget: Again, like Enterprise, some locations accept them and some don’t. Under 25 can’t use a debit card though. The ones allow debit cards require a hold for the estimated charges plus the greater of 25% or $300 (or $500 in the Northeast and North Central regions).
  • National, Alamo: These companies are both owned by Vanguard Car Rental USA Inc. so they have the same policy of allowing debit cards.
  • Avis: They allow debit cards and they will put a hold for the estimated rental charges with a minimum of $500. If you don’t spend $500, the balance will be returned but may take up to two weeks!
  • Dollar: They allow debit cards and will put a hold for the estimated amount of the rental plus 15% or a “minimum amount,” which isn’t specified. In that General Policies page, it’s section F. Credit Qualifications/requirement.
  • Thrifty: Some locations will allow debit cards and may require a “debit card check and credit inquiry screening,” whatever that means. The debit card must also be a VISA/MC debit card, anything else isn’t accepted.

As you can see, using a debit card is a bit of a pain and sometimes the hold can last up to two weeks after the rental! That’s a very long time.

My advice? Get a credit card with auto rental liability insurance and use it to rent your car. The card provides some supplemental insurance, you don’t have to deal with debit card hassles, and maybe you earn a few points along the way.

{ 34 comments, please add your thoughts now! }

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34 Responses to “Renting A Car With Debit Card”

  1. Moneymonk says:

    I have rented cars from all these agencies with my debit card over the past year.

    The longest anyone took for 3 days to release the hold.

    • IW says:

      None of these responses refer to a prepaid debit card through Netspend. I no longer have a checking account or credit cards because of 2 really very bad identity theft scares over the last 5 years. I either pay with cash, m.o. cashiers check or use the prepaid card. I plan to rent a car on a trip and the card will be top heavy loaded for any charges that might occur for the car, airfare etc.

      • Angie says:

        What did you find out about the prepaid Netspend card. That’s what I use now and I’m trying to find a car rental company that will accept those. I’ve been told that their system does not recognize those cards.

      • sheila says:

        Was told prepaid debit cards are not used because technically they are not attached to a bank account to come after in case of any problems.

    • Shaun says:

      I know from experience that as of last year the policy for Alamo, Hertz, and Avis is that they will only allow you to rent with a debit card if you are flying into that location to pick it up. Be careful of online travel websites. They will allow you to reserve a car, even confirm it, with a debit card. But if you are local and stop in to pick up you must have a credit card to leave the lot with the car. I almost had a problem on our last vacation because of this. Alamo blamed the website, website blamed Alamo. Both told me that I would be on the hook for the cancellations… thankfully I inquired before my vacation started. I have a credit card now and I REFUSE to use Alamo because of poor customer service.

      Enterprise is the only local company that I know of that allows a Debit card. They hold $600, they are slightly more expensive then other brands, and you are limited geographically… but they accept the debit card provided you have proof of address (current utility bill etc.)

  2. Hotels are also now instituting similar policies of “holding” an amount in excess of the room charges. The policy seems to vary from hotel to hotel, even within the same chain (i.e. Marriott to Marriott), but most places I have seen with this policy will post something clearly at the front desk – others go so far as to say something when you offer a debit card for payment.

  3. FMF says:

    “I usually advise against the use of debit cards because the card is linked directly to your debit card.”

    Do you mean that the card is linked to your bank account?

  4. Vic says:

    I’ve rented a Budget car by the month several times and the hold only lasts for 24 hours. When I asked at the bank they told me, yes, in Maryland the hold can only be for a day.

  5. Jason H says:

    Just a minor nitpick. National and Alamo are owned by Enterprise now, so the policies may be changing.

  6. Eden says:

    I’ve rented a car with a debit card and didn’t have any problems. I think it was with Enterprise, but to be honest it was almost 3 years ago so I don’t remember the details and policies may have changed since then.

    Just last week I used my debit card to pay for a hotel and cover the incidentals and whatnot. Again, that was not a problem at all.

    I think the important distinction is actually having money in your checking account! If you are cutting it close with bills every month or living paycheck to paycheck you really should use a credit card instead. If you have a float of $1,000 – $2,000 in your checking account you can easily handle rental cars and hotels.

  7. Nice roundup; I’m actually surprised that many chains let you use a debit card at all.

    Personally, I would be extremely nervous renting a car on debit card given how open ended the potential for extra charges is — unlike an airline ticket or (under normal circumstances) a hotel room, there are a ton of extra fees that could come into play with a rental car, not to mention the potential for the rental agency to assess (wrongly or rightly) charges for damages. It just seems like its a lot safer to have the consumer protection of a credit card. (I think this is even more true when renting from U-Haul, which is known for some pretty shady practices…)

  8. Jonathan Blakey says:

    Just rented a car for a week with Avis and the hold was gone before I got off the plane (within about 5 hours).

    I did have a reasonable amount of financial “cushion” in the account, which if you are going on vacation, you should probably have anyways because if a plane gets grounded you’ve got extra hotel costs, or if a medical emergency happens, etc.

  9. Hanuman says:

    I have a current rental from Deluxe Rent-a-Car in Los Angeles who is charging me $4.99 per day because I’m using my Visa sponsored debit card. There are ample funds in my account and the representative could only explain the charge was simply “company policy” and nothing more – kinda insulting. The car is great, but this charge is bugging me. Bank of America had no explanation either.

  10. R says:

    The amount of money in your checking account has nothing to do with anything. I always have around $2000 in my checking account and it makes no frigging difference. I always have a lot of trouble trying to rent a car with a debit card.

  11. Anonymous says:

    I have rented from enterprise multiple times, they take a hold of whatever the expected total will be plus $200.00. I have called and requested that I keep a car for up to a week longer than the intended length and it was not a problem and I have traveled as far as 4 states away, with thier knowledge and it was not a problem. They do require that you bring a utility bill with your home address and a pay stub with you however.

  12. Anon says:

    I have found the policies to vary so much from counter to counter, from franchise to franchise and even from the day manager to the night manager that it’s just too unpredictable to count on renting a car with a bank debit card, even with a pretty hefty checking account behind it. Not to mention demeaning to get sent away even after doing the research.

  13. ness1 says:

    I recently rented a car in Las Vegas using only my debit card with Alamo. It was a breeze. I wasnt subjected to a credit check nor was a large amount held from my bank account. I simply called an hour in advance to reserve the car and showed the rental agent my return flight information. The customer service was efficient and polite. I would definetly use Alamo again.

  14. JR says:

    National does NOT allow debit cards, as I found out today. And now I’m stranded here for the next 2 days. Don’t bother having them call a manager as National is not interested in customer service. Thanks a lot a-holes!

    • Angela says:

      I have rented with a debit card at National several times. No problems.

    • suzyq says:

      I rented from National with only a debit card a few weeks ago with no problem whatsoever. I had come prepared with utility bills, etc. but they did not ask for any of it. They did try t o sell me their insurance as well as a bigger car, but gave no lip when I politely refused. I did have a round trip air itinerary, however. Don’t know how that would have gone had I not been an airline customer. The car was great, service spectacular and the rental was not a penny more than anticipated. That is the first time that has happened, believe it! I was VERY happy with every facet of my rental experience. Kudos, national. And, oh yeah. . . as far as I could tell, there was no hold on my account, or if there was, it was very short lived and I was never aware of it.

  15. Derek says:

    Have had experience using a debit card to rent using National (in Pittsburgh) and Alamo (in Las Vegas)…at airport locations all they want to see is a copy of your return itinerary. They do put a hold for the estimated charges but, at least for me, it dropped off my account in 24 hours anyway. National and Alamo are under common ownership…and they seem to have the most liberal policies regarding this for visitors. Trying to do this if your a local renter is another story, though!

  16. Glory says:

    We tried to rent a car at Budget in Ft. Myers Florida and they allowed us to reserve the car online w/ MC/Debit but once we got there to pick up the car they absolutely refused to accept the debit card, even with a $450 deposit. We had to use a friend’s credit card to check out and pay with our debit when we returned the car. Really, really stupid. They should allow us to show proper insurance and enough deposit to cover the deductible and rental charge. Period.

  17. Matt says:

    Visa and MasterCard need to step in to stop this discrimination of their card holders. A Visa or MasterCard debit card works exactly the same way as a credit card on the merchants side. The banks need to stop writing DEBIT all over the card and make it impossible for merchants to differentiate between credit and debit cards. It should not be up to the merchant to tell you that you have to use a credit card. Credit cards are no more secure then debit cards as with credit cards your maximum allowed is your credit limit, which can be very low. People with checking accounts with a lot of funds can easily have more spending power. This is just ridiculous.

    • Lisa says:

      I totally agree with you Matt. I have always said this. There were times when I rented a car with a credit card with a $400 max, the car rental was $300+ which didn’t much room for “incidentals”.

    • Peter Jones says:

      Use cash everywhere if you wish to boycott those large greedy and unfair corporations.

  18. reallymad says:

    Yes Avis does in some locations, but do you realize that when using a debit card with a Visa or MC logo you must under go a credit check with Equifax? How ridiculous is that? Yes you must give them your SSN and go through a credit check! I guess Avis believes that if you don’t have perfect credit (who does in this economy?) that you are going to steal their car! My husband and I are small biz owners and were hit hard by the economy and by the fact that our credit cards doubled or tripled our minimum payments (oh yeah we are one of credit card company’s victims). Needless to say, we couldn’t keep up with the payments. It seems that every where you go now a days someone wants to check your credit. It is getting absolutely ridiculous! Now for a freaking car rental??? Needless to say, I will continue to use Enterprise. They didn’t check my credit and guess what? We returned the car safe and sound!

    Read more: Do rental car agencies accept debit cards for renting a car? | Answerbag http://www.answerbag.com/q_view/2096471#ixzz1NO3xNnOI

  19. DON'T KNOW WHAT TO DO????? says:

    I HAD A GREAT LIFE WITH A MAJOR CREDIT CARD, A MASTER CARD FROM 1st COMMONWEALTH BANK. A NEIGHBOR HAD ME CASH A $2,250 DOLLAR FRAUD CHECK FOR HER, AND HELL FOR ME BEGAN. THERE IS A FREEZE ON MY ACCOUNT UNTIL THE MONEY IS RETURNED OR PAYED BACK AND UNTIL SHE IS ARRESTED, IN WHICH SHE IS RUNNING. I HAD TO RESORT TO A PRE-PAID MONEY CARD. I HAVE A VISA AND A MASTERCARD PRE-PAID MONEY CARD. BOTH WITH DIRECT DEPOSIT, $1,200 ON EACH CARD EACH MONTH. THEY PUSH AND PUSH FOR YOU TO GET THESE CARDS. ATM WILL GIVE YOU YOUR MONEY BACK AND YOU CAN USE THEM SHOPPING, BUT YOU CAN’T RENT A CAR. I OWN A CAR, BUT IT’S IN THE SHOP AND NO ONE WOULD LET ME RENT A CAR WITH THIS PRE-PAID DEBIT CARD. THE MONEY FOR THE COST OF THE RENTAL PLUS WAS THERE, AND I HAD MY OWN 100% FULL COVERAGE CAR INSURANCE. THAT DID’T MEAN A THING. COME ON, AT THE RATE OF WHAT THEY CHARGE FOR CREDIT CARDS; MY MOTTO – “IF I CAN’T PAY WITH CASH, THEN I DON’T WANT IT, NOR DO I REALLY NEED IT”.

  20. I NEED TO KNOW WHICH CAR RENTAL RENTS WITH A PRE-PAID DEBIT CARD. I AM MISSING OUT ON MAKING A LOT OF EXTRA MONEY WHILE MY CAR IS IN THE SHOP FOR INSPECTION AND IN NEED OF A LOT OF WORK???????????????????????????/

  21. liz says:

    i dont mind using debit card thats all i have that or cash do not have credit card

  22. liz says:

    i guess it depends on the location
    ive rented with dollar/thrify as dfw airport with debit card without a problem
    im now going lax soon and have been hunting around for a rental company that i can pre pay and pay deposit with debit card some are cash only deposits are high $600 si what most want
    and i want one that does NOT perform a credit check
    i have cash in debit card and if i use cash, no need for any checks

  23. Tess says:

    I am looking for a rental service that will rent me a car with my debit card only as I don’t have the best of credit. Does anyone know of any rental service who will rent without doing a credit check? I do have more than enough funds to cover the fees.

  24. sharon says:

    I tried to use my debit card at Enterprise, now that is just like cash, it would have been refused if I had not enough money in my account. I even offered to pay in Cash, and they refused it telling me they only take credit cards, yea that is great and add more charges on to it. for themselves. Now any idiot car rental company that does not take cash needs to be closed. I had to call a friend up and have them use there credit card, and I paid them back. I never heard of such an idiot policy, that needs to be changed.


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