Reader Lauren has a question about her hotel billing situation. She writes, “I was thinking of starting a new life in Oregon about two years ago and things didn’t turn out the way I expected. Unexpected costs, auto repairs, illness, housing, etc.
“I lived in a motel and the manager has used my credit card for the month without my knowledge or authorization twice now. The load appears just one day. I told him the first time not to do this. I might want to use another card. She did it again this month, I didn’t have enough on account and now I’m overdrawn. Can she continue to do this?
No billing without authorization
First of all, credit card holders need to be reassured that no one can charge your card without your authorization. They must first obtain your authorization. This is true whether you are paying in a mobile transaction or any other “card not present” online mode.
The Federal Trade Commission advises that it is also breaking the law “by charging people for negative options, automatic mailings or continuity programs without their express consent.”
A negative option is when people choose specific choices without their consent and without making a disclosure, unless they opt out. For example, a business shouldn’t send you periodic notices offering goods, such as books, and then follow up by sending you the goods and billing you because you didn’t decline the offer.
A magazine subscription may also automatically renew when it expires, unless you expressly cancel it. In another example, a seller might offer you a free or discounted trial period to try something, and then automatically bill you at a higher rate when the trial period ends.
Hospitality industry policies
The hospitality industry is no exception to the rule that the consent of the cardholder must be obtained before debiting your card. Typically, hotels will notify you and place an authorization on your card when you check in. This will cover your hotel bill and also add an amount for “incidental charges”. Maybe you took advantage of the snacks left in your room, for example, and it would be billed as an incidental payment.
Your card will be debited when you leave the hotel. If you accumulate more fees than the original holdback amount, you will need to make up this difference when paying.
In an extended stay situation, a hotel or motel will likely obtain your authorization to withhold credit card payment at the time of check-in. It will then debit this registered card at regular intervals, usually by blocking your card for the money owed. .
Try to change card in the folder
Lauren, it appears that your hotel manager did not act illegally since the hotel would likely have obtained your authorization in advance (at the time of check-in) to withhold your card at regular intervals for amounts owed. You should talk to them and see if you can change the card registered with the hotel for future payments.
Since this is an extended stay hotel and you are not sure how long you will stay, be sure to upgrade to a card with sufficient line of credit to cover your planned stay. Otherwise, you will be charged for exceeding your credit limit, if you have opted for such protection.
The bottom line
Businesses can’t charge your credit card without authorization. Hotels will usually obtain your authorization to suspend your card for your stay when you check in. They don’t need to let you know every time you’re billed. Lauren, I hope you can sort this out with the hotel.
Contact me at [email protected] with your credit card questions.