Taking a glimpse at the car rental industry, renting a car might not seem expensive, especially when doing it for the first time. However, they are, indirectly.
One route most car rental companies take to charge renters heavily, if summed up, is through Security Deposit.
This is a fee, charged on your credit card alongside the trip fee, which is expected to cover any extra expenses and fines that are discovered after a particular rental period is over.
In this article, we’ll cover how you can avoid security deposits on rental cars, regardless of the company in question.
What is the deal with Security Deposit and Car Rental Companies?
Ever wondered why car rental companies are after charging security deposits on cars, even when the fee is totally refundable and of course, you still pay your normal rental fee?
Well, the primary reason for this is to easily cover any unseen damages or charges, when a rental period is over.
Note that if there isn’t any additional charge after a rental period, the security deposit initially charged, would be refunded back to you, in total.
However, this is unlikely to happen.
This is because there are usually a handful of hidden fees, policies, and fines, that most car rental companies indirectly hide from customers, not until it’s time for payment.
In previous articles, we’ve mentioned a list of these hidden fees across Budget, Thrifty, Turo, and Dollar car rentals.
On second thought, you might also want to know why they put the charge for a security deposit before renting and not after renting.
Well, they do this before renting, to make sure you have enough money to cover the total cost for possible damage or violations.
Because as a matter of fact, hidden charges and damages are usually expensive. Not everyone would afford to pay a huge sum of money for a fine, after successfully renting a car.
How to Avoid Deposit on Rental Car
Even though they’re refundable, most people dislike the idea of having to drop hundred to thousands of dollars, with a car rental company.
If you’re in these shoes, the following listicles point out how to avoid Deposit on Rental cars:
Take the Insurance Route
The primary reason why car rental companies charge security deposits is to reduce the risk of not being paid for car rental damage, trip fee, or fine after a successful rent to a customer.
In other words, if you can assure such a rental company that you won’t get into one of these, they could take off the security deposit, right?
Read also: Can you Add Insurance after Renting a Car?
Well, yeah.
One way to do this is by signing up for proper insurance and extra covers at the car rental company. In most cases, the company would reduce the total amount of the security deposit.
However, make sure to let the company about your intention.
Rent from Security-Deposit-Privilledged Locations
When renting a car from a car rental company you know less about, feel free to ask them questions about their policy.
In the case of security deposits, asking them about “how their security deposit works” and “what condition could rule out the security deposit fee,” could be a good step.
For instance, in some car rental companies, there are usually some locations that are excluded from the security deposit charge.
Apart from this, Locations also contribute to the amount of the security deposit charge.
Popular and well-crowded locations could increase your security deposit charge, whereas less popular locations would do otherwise.
Rent From Smaller Car Rental Companies
While the majority of car rental companies in the US require a security deposit before renting out cars, you could still find a few that doesn’t.
For instance, At Avis car rental, you don’t need a security deposit to rent a car, as long as you provide an acceptable credit card.
You could also try going for small chains or independent car rental companies, as they are usually found to have lower requirements and cheaper security deposits, as well.
A typical example of this is going for sister companies instead of head companies. E.g Avis instead of Budget and Alamo instead of Enterprise.
Also having a discount code for the rental company which you wish to rent from, could also waive the security deposit charge.
To find these codes, you can make a simple search for “discount,” “promo,” or “coupon codes” for your choice of car rental company on Google.
Always Pay with a Credit Card
Even though many car rental companies accept payment methods like Paypal, Apple Pay, and Debit cards, they are actually not a fan of them.
At most car rental companies, using any payment method other than Credit cards puts you into having to satisfy several other requirements before renting a car. Some of these requirements include:
- A clean criminal history and driving record
- To Meet a required age
- To pass through a credit check
- Pay a higher security deposit
As a matter of fact, one of the contributing factors to security deposits is the methods used for paying the rent. In most cases, rentals paid via credit cards usually gets a lower security deposit.
Negotiate with the car rental company
One other thing you might want to do to reduce or avoid a car rental security deposit is to negotiate with the company behind your rental.
While this might not seem achievable, you could get a good response, especially when you have a good credit score and responsible rental history with the company or a sister company.
Use the pay later option available to some car rental companies
The reason why most people always try as much as possible to avoid the security deposit, even when the charge is totally refundable, is usually because of the fear of having to leave a huge sum of money with an entity they don’t trust.
Well, by using a Pay later option you could avert this fear since you won’t be paying for the car or any extra charges before renting.
Now, many traditional car rental companies don’t offer these services, however, one way to do this is through Affirm’s partnership with Priceline.
Final Thoughts
While it could be difficult to do, you can actually avoid or reduce the security deposits on most car rental companies.
However, note that in any case you successfully waive the security deposit, you’re still responsible for any damage, fine or hidden charges you get charged, after a rental period.
