| 25 Jul 2010 |
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Property agency introduces rent payment with credit card Pay your rent using a credit card
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Sunday, Jul 25, 2010
Gulf News
Property agency’s offer only applies to tenants choosing to make full annual payment upfront
Dubai The novel concept of rent payments through credit cards has made an entry into the Dubai property market.
Property agency Landmark has made the offer for units in Discovery Gardens, according to advertisements. A Landmark agent confirmed the offer to Gulf News yesterday.
According to the Landmark agent Eddy, credit card payments will be accepted only if the tenant chooses to pay the whole year’s rent upfront. If the tenant wants to split the rent and pay on a half-yearly or even monthly basis, the usual practice of post-dated cheques will be followed.
“The landlord needs some security,” Eddy explained.
All credit cards are accepted, but no discounts will be given. However, banking experts are sceptical about the offer.
First, the tenant needs a huge overdraft facility on the credit card, and even if the overdraft is repaid in monthly instalments from the tenant’s salary, accumulating interest will make it an expensive exercise.
Second, not every bank might agree to book a full-year rent payment on a credit card because this form of payment indicates that a tenant could already be struggling with other payments and has a higher likelihood of defaulting.
By Arno Maierbrugger?Deputy Business Editor
© Gulf News 2010. All rights reserved.
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Community Comments (1)
It could be good if you have the credit limit already and the available funds from an upfront housing allowance.
Then you could charge the card that offers good benefits like a frequent flyer program and accumulate a bunch of miles on spean you might otherwise not have gotten.
Also, if it's a new card offering no interest for 6 months and say the housing allowance is paid twice a year, you could:
charge the card
book the first six month's rent allowance to earn at least 3%,
then after 6 months you get the second allotmant for housing
pay the full amount off and book the interest
of course these are more the exceptional situation where it might make sense.
Monthly Financing using a credit card would be non-sensical, and should not be used in general and especially if someone needs to use it cause of mounting debt.
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