Credit Card Pre-authorisations in hotels

joviscot

Can anyone tell me how credit card pre-authorisations work in hotels? I checked into a hotel in Ireland last Friday and they asked to take a pre-authorisation on my card. I automatically consented as this is nothing different to what happens in any other hotel and typed in my PIN. When I checked out I paid the bill, typing in my PIN again and assumed the pre-authorisation was cleared. It was not until I checked into another hotel as part of my stay in the country and was refused authorisation that I discovered there was a problem with my card (luckily I had another card with me that I could use) - on phoning the credit card company the next day I discovered that both the pre-authorisation and the actual charge were both sitting as transactions on my card thereby pushing my balance over the credit limit (the limit being quite low).

I phoned the hotel in question who said that if the credit card slip I had received on departure said 'completion' then that should have cleared the pre-authorisation, if not immediately certainly within a couple of days, but obviously this was not the case. Another phone call to the credit card company met with no success - they said it was the hotel's fault as they had put through the transaction twice and in the case of a pre-authorised amount the hotel had 30 days in which they could take that money (in other words a pre-authorisation doesn't physically show on your statement but is almost like an unposted transaction counting against your credit limit). And so it went on......... - each party saying it was the other's problem. It was only tonight after yet another phone call to the credit company that they reversed the pre-authorisation charge (a full 7 days after it was initially taken!) but only because of the number of time's I'd phoned - they still say they're not the ones in the wrong.

I'd be interested to hear if anyone else has landed in this situation or if anyone knows if this to be normal practice because I stay in hotels quite regularly and never had this happen to me before. Surely all pre-authorisations can't count against your credit limit for 30 days before they're cleared?? If so, hotels should be making this much clearer to their guests.

Thanks in advance.

gazza975526570

it does sound rather odd.

I stay in hotels regular and you dont give it a seconds thought - you just think they will cancel/it will be irrelevant (the pre auth amount that is)

It sounds to me that the blame lies with the hotel in that they didnt cancel the pre auth amount.

i presume your all sorted now?

joviscot

I'm sorted but it's taken until today to manage to get anyone to do anything about it, so that's a reasonable amount of time and money in terms of the phone calls involved. What's irritating me most is that nobody's admitting they're wrong and without knowing how the process should work, I'm worried it could happen to me again. But you're right in what you said, you normally don't tend to give the pre-auth a second thought.

donsguy

I used to work in Hotels, what you have to be careful of is staff that dont complete your pre-autherisation, and instead swipe your card through as 'sale'. This means if someone from the hotel doesnt cancel the preauth (which happens more than you think) you are gonna be lumbered with this type of hassle.

joviscot

Donsguy - if the hotel hadn't cancelled the pre-auth then and put it through as a 'sale', would it state this on the credit card slip or could it still say 'completion' on it as mine did? The hotel were claiming that because it stated 'completion' on the slip that should have cleared the pre-auth.

jetsetuk

This has happened to me with car hire firms who take quite a large pre-authorizations during the length of the hire. Even after paying for the rental the authorization stays on the account for days...it eventually is cleared and never shows on the statement, but reduces my available credit until it does.

Because of this I'm quite happy to keep my everyday card, which I pay off every month, at the highest limit the card company is prepared to give me, even though I never spend anywhere near it.

donsguy

If your reciept says completed then the preauth should have been removed from your card. Unless of course someone messed up inputing the wrong preauth code which would mean that the original preauth would still be sitting there unused.

mr_e_5

The same has happenned with me. Using a Barclaycard I checked in for giving pre-auth for my two nights stay. I used the card as I was on a shopping trip and went quite close to the limit. When it came to checking out it was refused and i knew why straight away.

This is not the fault of the credit card issuer. The hotelier should complete the original transaction hence the term pre-authorisation. Knowing this from working in hotels when i was young I asked for the duty manager. She argued and eventually phoned the head receptionist (at home on her day off) who said i was right and told them how to finish the authorisation and commit the sale.

This happens alot and is down to untrained staff.

---lee---

Any amount authorised but not collected remains authorised for 7 days and therefore reduces the available credit. After 7 days, the authorisation is atuomtically cancelled.

It sounds like the hotel did a 'new' transaction when you checked out, rather than collecting against the previous authorisation.

It's the responsibility of the merchant to cancel the authorisation if it's not required.