I was wondering if anybody knows if it is a good idea to let someone pay rent with their credit card, because if someone stops paying rent they are not going to go to the bank and cancel their credit card so you keep on charging the card so pretty much the bank is going to take the loss.
Or do I have it all wrong, hopefully this question makes sense.
Laws vary state to state on how you hold and store credit card info for recurring purchases. Its not a good idea. If your tenant is living off credit cards you need to find a new tenant. If they dont have cash or a check just evict them. You're also paying fees on every transaction. Save your money.
Actually it's pretty easy to cancel a credit card and have it reissued, usually within days. If someone can't afford their rent they're probably not paying other bills either so they will either hit the credit card limit pretty fast or the bank will freeze it. The merchant fee also cuts into your return.
Personally I'd take it and make them pay whatever it costs. Not your job to teach them finances, but I'd ask about their money situation and plan with them if they need to move. I'd way rather let them out of the lease if they're struggling then wait until they are dead broke with no place to go so milk the eviction process for all its worth. Could just be a tight month, could be a job loss, just ask them.
Paypal will let them charge it and drop it in your bank, I think Amazon has a service too. Moneygram would do it online for minimal fee. Lots of ways to take Credit cards these days.
If you're looking at convenience, apps like Venmo allow for a transfer direct from a checking account, with no fees to either party.
Older sites like Paypal will allow you the same convenience at a higher security level, but they'll also charge you a fee.
Either method can also use credit card for an additional 3% fee
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