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Pros and cons of renting using Redweek escrow service or Paypal?

tborr123

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If a potential renter asks if you would consider using Redweek's escrow service (First American Title) or Paypal where you send the renter a bill to pay via PP, is either approach safe(r) for the owner? I know the escrow service can be expensive. Pros and cons with either? Thanks in advance.
 

theo

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If a potential renter asks if you would consider using Redweek's escrow service (First American Title) or Paypal where you send the renter a bill to pay via PP, is either approach safe(r) for the owner? I know the escrow service can be expensive. Pros and cons with either? Thanks in advance.

I am only occasionally (and always involuntarily) a "landlord" for our timeshare weeks; we own them to use them, but sometimes things happen preventing use.

That said, I personally dislike the idea of receiving payment for a rental only AFTER completion, which is the case with RedWeek's "escrow" service (regardless of who pays the escrow fee). Maybe you feel differently about that. I also don't care for the fact that a tenant can (after the rental) feign "dissatisfaction" for bogus, contrived reasons, further delaying (perhaps even eliminating) receipt of payment. That prospect also does not sit well with me. I cannot knowledgeably speak to PayPal practices (or fees), but I suspect that some or all of the same issues and concerns might exist there too for owners renting out intervals.

Unless your offered rental is one in which there might be little other interest or demand, I'd be inclined to "pass" on a "escrow-demanding" tenant. Fair or not, I frankly would also suspect that a nervous tenant-to-be insisting upon escrow might well prove to be a "PITA" overall anyhow. To each their own. YMMV.
 
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DeniseM

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PayPal and escrow are two different types of services. Paypal is simply a payment method. Escrow means your money is tied up until after the rental.

I would never agree to escrow - that means that you have to wait until AFTER the rental to get paid, and if the guest disputes the charges, you may never get paid.

I have used PayPal a lot, with very few problems. I like PayPal because you can send the guest a detailed invoice, listing the rental terms. However, a guest can dispute a PayPal payment, but generally not after the rental, unless it is a last minute rental. If they dispute the payment before the rental, you simply cancel their reservation.
 

vacationhopeful

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I side with Theo on Paypal ... USPS over night mail and USPS money orders is my preferred last minute payment option. They can track who signs for it and I get it in via a secure method of payment and sending. If there are 3 or more days, send me the payment via USPS Certified Mail for under $6 or $7 ... with Return Receipt that I sign for.

I only get mail at my Post Office box ... I do not like anything hanging on my door for a week or two. I have people who check my mail box if I am out of town for more than 2 nights.

So leave me a voice message .... send me an email .... but NEVER just keeping calling me, waiting for me to answer.
 

Jpollo

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We prefer a check, but often use PayPal Friends and Family. There's no charge to us and no cost to the renter unless they use a credit card, in which case they're charged something like 2.9%. Over the years I was pleasantly surprised that most folks were comfortable with the no-cost Friends and Family.

I've used the PayPal option to send an invoice, but I believe the cost is 2.9% + 0.32. One could either pass that on as a fee or price the rental to include that cost.
 

DeniseM

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Although it happens a lot, using Friends and Family for a TS rental is a violation of their TOS, and if you do it often enough, PayPal will notice.

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Jpollo

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Thanks for the heads up. Good reason to stick with checks, which we normally do. Maybe splitting the fee with the renter would be a good option if they desire to use PayPal. It sure is convenient.
 

exyeh

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Although it happens a lot, using Friends and Family for a TS rental is a violation of their TOS, and if you do it often enough, PayPal will notice.

Sent from my SM-T560NU using Tapatalk
We thought that paypal permit this kind of transaction, because we had this question and called to ask them, they said it is not against their policy and openly said we can use "friends and family" way for this purpose.
 

DeniseM

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No - you cannot use friends and family for business transactions. Friends and Family is for gifting money.

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Jpollo

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Took awhile, but I finally found the relevant language in the PayPal terms of service.
"You may not use the “send money to a friend or family member” feature in your PayPal account when you are paying for goods and services."
 

DeniseM

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Yes - buying/selling/renting are all business transactions - not gifts to friends and family.

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Jpollo

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Yes - buying/selling/renting are all business transactions - not gifts to friends and family.

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Interesting. I always thought selling a car or other good was a personal transaction and a business transaction involved a business entity.
 

vacationhopeful

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The best businesses treat their customers as "FRIENDS". It is not a transactions between friends, as a business transaction happens when a "item of value" is swapped/traded/exchanged for another "item of value".

If I give you an apple pie and you offer me a duck ... it is a business transaction if I take the duck. Or demand a better item.
But I tell you, I want NOTHING and refuse any/all offers of compensation .... that apple pie is a GIFT.
 
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