Don’t let a bank card turn your vacation sour
by Susan Tompor, Detroit Free Press, with editing
Plenty of people are packing their debit cards -- instead of credit cards -- as the plastic of choice this summer just because they want to avoid digging themselves deeper into debt. Consumers need to watch out, though, when it comes to using a debit card on vacation. There can be onerous holds placed on your cash, unwanted ATM fees, and even debit-card-related fraud out there.
Unexpected hold. Some hotels will put a lock on your money if you pay with a debit card, meaning you don't have access to that amount of money in your checking account when a hold is in place. That could trigger overdraft charges. Some hotels will hold 115% or 120% of the room charge plus tax on a debit card - that the hold might be for seven days or longer.
The FTC notes that how long your money is blocked could depend on how you pay the bill. The block could be lifted in a few days if the consumer pays the bill with the same card used at check-in.
However, if you pay your bill with a different card, or with cash or a check, the company that issued the card you used at check-in might hold the block for up to 15 days after you've checked out.
At the pump, it's possible to have $50 or more blocked for a time even if you only buy $25 worth of gas, for example. Consider paying inside the station and using the PIN so you're charged for the gas you buy and no extra money is held.
Theft. A crook could create more headache on the road if a debit card is your only source of cash.
Say you take your debit card on the road. You keep track of your spending, but one day, the debit card is refused when paying for dinner. You check your account and find someone has charged three items to a Best Buy across the country. One is $499 and two others are for $250. All three are under the $1,000 daily spending limit that would have set off red flags on his account.
Changing the red flag alerts to a lower amount to deal with the possibility of fraud would've been the answer in general, but it's better to travel with a credit card, not a debit card.
If the above were to happen then you could call the fraud number on the back of your card. The card would be canceled, but that would leave you without access to your money.
Will you be able to easily use an ATM? Absolutely, but at the same time, watch out for fake ATMs.
Crooks can install card readers in some ATMs to capture account information to make it easier to steal from you later. Stick with ATMs at a branch to be safer and cover your PIN number from prying eyes.
More Details: Debit or credit on the road?
• Before you pay with a debit card, ask well in advance if the restaurant, hotel or car rental service will block any money, how much and for how long.
• Pay attention to the policy at your bank relating to stolen or lost debit cards. It's up to the card issuer, not Visa, to expedite the replacement of the card. Different card issuers will include a 24-hour replacement policy as a perk of a specific program; others will charge cardholders a fee to speed the process. Some issuers provide instant issue cards from select branches.
• Carry a backup credit card, another debit card from another bank, or possibly some cash in case of emergencies when traveling.
• Take time to check your bank balance on the road regularly. Watch out for fraud.
• Debit cards are the best way to get cash from ATMs in the U.S. and overseas, but, credit cards can offer extra benefits, such as loss or damage protection for baggage, and points for mileage or other rewards.
• Can you build more rewards points with your credit card?
• Some companies will allow consumers to reserve a rental car using a debit card. But the rental company likely will do a credit check through Equifax or another such firm. Talk to the rental company about its debit card policies.
• At airport Alamo, Enterprise and National locations in the U.S. debit cards are accepted with proof of a round-trip travel ticket (airline, cruise ship or train), at the time of rental. At the neighborhood locations, debit card policies vary. Consumers should call the location directly to inquire about specific requirements regarding debit cards.
