Rental Car Tips: How to Avoid Deposit on Rental Car
The rental car business is full of fees, charges and add-ons. Many of these can be avoided if you are prepared. Deposit fees can vary depending on location and the type of car being rented.
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Book Early
If you are planning on renting a car, the best way to avoid having to pay a deposit is to book early. This will give you a better chance of getting the type of car you want and may also save you money.
Rental companies will often have a limited amount of vehicles, especially during busy travel times like the summertime or holidays. If you are after something unique, like a minivan or swanky sports car, it will be even more important to book far in advance to ensure they have these specific vehicles available during your travel dates.
In addition to booking early, a great way to save is by using a credit card that offers rewards such as miles or points for car rentals. Some membership programs also have a relationship with rental car companies and offer discounts as a member perk. It is always worth checking these programs before booking as they can save you a lot of money.
Don’t Pay With a Credit Card
Many rental car companies require that a credit card be used as the security deposit. The rental company puts a hold on the card equal to either a fixed dollar amount or a percentage (usually 15 to 25 percent) of estimated charges. This holds the money until the rental car is returned undamaged and without any extra fees such as fuel, roadside assistance or additional days.
Some personal finance experts, such as Dave Ramsey, recommend renting a car with cash to avoid having to give the rental company a credit card. However, this may not work for everyone as different rental car companies have their own rules about acceptable forms of payment.
Credit cards are preferred by rental car companies as they allow them to run a credit check before renting out the vehicle. This allows them to assess a driver’s ability to pay for damages. However, cash and debit cards do not require a credit check.
Keep a Record
Many rental car companies will ask you to pay a deposit with a credit card, which they ‘block’ (it won’t show up on your spending limit) to protect themselves from damages or losses while you rent.
Some rental car companies will also allow you to pay with a debit card, but it is much less common. Regardless of whether you use a credit or debit card, it is important to double-check the rental quote and any add-ons for hidden fees.
The amount of the security deposit will depend on the car type/category, your age and where you are renting (and returning if it is one-way). Smaller companies often have more flexible policies and lower deposit requirements, making them a good option for those looking to avoid paying huge deposits.
It is also best to conduct a thorough inspection of the vehicle and document any existing damage to ensure that you get your deposit back when you return.
Beware of Hidden Fees
The rental company may charge you for add-ons, such as a GPS, toll plan or access to XM radio. Make sure to read their T&Cs before selecting any additional extras.
If you dispute a charged fee, save all receipts and correspondence with the car rental company including email and letter dates. It’s best to resolve billing disputes by phone or email so you have proof of your conversation if you need to dispute the charges later.
You may also be charged for adding an inexperienced driver to your contract its best to stick with experienced drivers and avoid paying the extra daily fee, if possible.
If you can’t avoid a deposit, shop around and use resources like Kayak and Priceline or Autoslash to find cheaper options. And don’t forget to stop and fill up the tank before returning the car to avoid refueling fees! Also, plan ahead to return the vehicle before your time expires or you could be hit with a late return fee.