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Definition of clear funds

Hi,

When renting somewhere they often want you to be able to pay the deposit and all other fees with 'clear funds'. So obviously I know this means you can't therefore pay by credit card however can you pay with your current account but the amount will put you into your overdraft? Would that still count as clear funds?

Thanks :)

Comments

  • karcher
    karcher Posts: 2,069 Forumite
    1,000 Posts Combo Breaker
    Hi,

    When renting somewhere they often want you to be able to pay the deposit and all other fees with 'clear funds'. So obviously I know this means you can't therefore pay by credit card however can you pay with your current account but the amount will put you into your overdraft? Would that still count as clear funds?

    Thanks :)

    Yes.

    How could they possibly know you have gone into your overdraft unless you tell them or the payment is rejected?
    'I'm sinking in the quicksand of my thought
    And I ain't got the power anymore'
  • Ok thank you, I thought so just wanted to check for peace of mind more than anything!
  • glasgowdan
    glasgowdan Posts: 2,967 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Are you sure this means no credit card? Surely it simply means "until we've got the money"
  • No it specifically says 'this means no payment by credit card' :)
  • It's "cleared funds". It means the money is in their account , not coming on some slow 3-day bank transfer or in the form of a cheque yet to be paid in by them
  • agrinnall
    agrinnall Posts: 23,344 Forumite
    10,000 Posts Combo Breaker
    It's "cleared funds". It means the money is in their account , not coming on some slow 3-day bank transfer or in the form of a cheque yet to be paid in by them

    It would be very slow as 3 day payment for personal account customers ended by 2012!
  • No it specifically says 'this means no payment by credit card' :)

    They're fudging on the issue. The reason they don't accept credit cards is because they pay fees for credit card payments. As previous posters said, cleared funds is about the money being in their bank account.
  • eddddy
    eddddy Posts: 17,824 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    When renting somewhere they often want you to be able to pay the deposit and all other fees with 'clear funds'. So obviously I know this means you can't therefore pay by credit card however can you pay with your current account but the amount will put you into your overdraft? Would that still count as clear funds?

    "Cleared funds" is nothing to do with credit cards (or overdrafts). It's a reference to payment by cheque.

    If you pay by cheque, it could take up to six days for the cheque to clear.

    So if you give the letting agent or landlord a cheque on Monday, they would not have cleared funds until a week on Tuesday.

    With credit cards and debit cards, payment is immediate - you don't have to wait for them to clear.

    With bank transfers, as soon as the money reaches the payee's account, the funds are cleared.
  • Credit cards can also results in chargebacks. I imagine a letting agent doesn't want a potential tenant to chargeback any fees paid to them.
  • eddddy
    eddddy Posts: 17,824 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Credit cards can also results in chargebacks. I imagine a letting agent doesn't want a potential tenant to chargeback any fees paid to them.

    Not really.

    Chargebacks can only be used for breach of contract and fraud - not just because the cardholder asks for one.

    If the cardholder alleges a breach of contract, the bank would check with the letting agent, before refunding.

    (e.g. You can't pay in the supermarket with a credit card and then just decide you want your money back.)

    And if chip and pin is used, a fraud chargeback isn't possible. (Fraud chargebacks are only possible if a PIN was not used - e.g. phone transactions.)


    However bank transfers can be reversed if they are fraudulent. So the letting agent is safer accepting a chip and pin credit card payment than a bank transfer.



    BUT the reason letting agents don't accept credit cards is the charges.
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