Do Car Rentals Do Credit Checks?

Car rental companies assess a renter’s financial reliability to manage potential risks. Understanding their practices can help prepare for a smoother rental experience.

Car Rental Credit Inquiry Practices

Car rental companies often conduct credit inquiries, though the type of check can vary. They typically perform a “soft” credit inquiry when a customer uses a credit card for payment. A soft inquiry allows the company to review certain aspects of a renter’s credit background without impacting their credit score. This type of check is generally used for informational purposes, aiding in pre-approval processes or when a credit card provides a layer of security.

Conversely, a “hard” credit inquiry is more common when a renter opts to use a debit card. This type of check can temporarily lower a credit score by a few points and remains on a credit report for up to two years. Rental companies utilize credit checks to assess the risk of non-payment, prevent fraud, and ensure the renter can cover potential costs such as damages or fuel charges. Some companies may require a fair to average credit score, typically ranging from 550 to 600, for standard rentals, while luxury vehicles might necessitate a higher score.

Eligibility Beyond Credit Scores

Beyond credit inquiries, car rental companies consider several other factors to determine eligibility. Age requirements are standard, with most renters needing to be at least 25 years old to avoid potential surcharges, although some companies permit rentals for those 21 and older with an added fee. A valid, unexpired driver’s license, issued by a U.S. state, U.S. territory, Canada, or an acceptable foreign country, is mandatory and must be valid for the entire rental period. International renters may also need an International Driving Permit alongside their home country license.

Rental companies often check driving records for major violations, such as reckless driving convictions within the past three years. Residency can also play a role, particularly for debit card users, with some agencies requiring the renter’s address to be within a specific radius of the rental branch or to match their driver’s license. Additional identification, like a passport, military ID, or a recent utility bill, may be requested to verify identity and address.

Alternative Payment and Deposit Options

Using a debit card for car rentals often involves additional requirements compared to using a credit card. Many major rental companies accept debit cards but may necessitate extra documentation, such as proof of a return travel itinerary, particularly at airport locations. When a debit card is used, the rental agency typically places a significant hold on the account for the estimated rental cost plus a security deposit, which can range from $200 to $500 or more, making those funds temporarily unavailable.

Security deposits are standard practice, held by the rental company to cover potential additional charges like damages, late return fees, or fuel. While credit cards allow for a pre-authorization hold that does not immediately debit funds, debit card holds directly reduce the available balance in the associated bank account. The release of these funds can take several business days, often between 7 to 10 days, but sometimes up to 30 days for debit card transactions, depending on the bank. Cash deposits are rare among major rental companies, often accepted only by smaller, independent agencies, and usually come with even stricter requirements and higher upfront amounts.