chrism20

Yeah it can be quite annoying especially if you are away for a week or so and in several hotels. In the case of last week they took Ł50 pre-auth on the app check-in, Ł50 at the front desk and both appeared to be holding along with the final bill which was only around Ł40, I had booked a pre-paid rate as I knew I definitely had to be there due to work so that was taken care of weeks ago. Only small amounts this time but I've seen five or six times that sitting showing as pending as it hasn't been cleared down properly.

Baze

I am assuming all those having this problem are using a card at check in then when check out us a different form of payment as I have never seen this problem. But I always use whatever I use at check in as the final form of payment at checkout.

RogerD408

There is no fixed policy. The process is defined by the merchant's CC processor, their bank, and your bank. Typically, if a pre-authorization is done and a final against the same transaction, then it should clear quickly. An issue comes up if they do not process the final against the same transaction. There's no flag to close out the pre-authorization and must timeout.

A possible solution to the OP's issue might be to pay all but the last dollar with the gift card and have them close out the pre-authorization for the remainder. Just a guess, but seems to have some logic to it. Still requires them to do it right, but hopefully they will learn.

chrism20

No, I always use the same card.

The problem seems to be when they don't hit the use pre-authed txn button and enter the original authorisation number from the pre-auth for the final bill. By doing this it clears the pre-auth and returns any residual funds back to the account.

Some FD staff forget and just start a new transaction leaving the pre-auth open and the final bill coming out of unreserved funds on the card.

This was what happened with me last week anyway although I also had the app pre-auth showing. The amounts were small and I was happy for it just to drop off later rather than go to the hassle of contacting the hotel.

I did have one about a year ago for an IHG hotel that between the pre-auth and transaction had claimed about Ł1,400 of funds and I had to contact the hotel regarding that one.

Baze

Ah, Ok. Have not run into this problem. Yet.

ChinaShrek

I am reviving (or continuing) this thread because I think this issue is getting ridiculous. I have had two authorizations by hotels in Europe that stick around forever. The first hotel authorized my credit card for 1000 Euros (fine) but then when I checked out they charged me separately for another 1000 Euros. The first authorization is still there - two weeks later! The second hotel authorized my card for 600 Pounds at check-in and here it is a week later and the charge hasn't been finalized. It is still pending.

Would people support legislation to require authorizations fall off after 7 days? Would there be any negative effect to such a policy/law?

RogerD408

Given there are several organizations involved here and may even be international, I doubt any law could be passed that wouldn't have major loopholes.

First, the property is at fault here in not processing their transactions properly. When they book an authorization, they should pull that same transaction up to post the final payment. The best example to use here is a restaurant. When you first give your card to your waitstaff, they swipe the card and enter the amount of the bill. This posts as an authorization to validate the card and available balance. Then, after you may have added a tip and signed the slip (if not done online) they add the tip and close out the transaction. Only one transaction is processed.

If the property fails to pull up the authorization transaction to process your final bill, they generate a second transaction and the authorization goes abandoned. Given a merchant has a few days to process the final charge, your card organization (such as VISA) and/or bank my have defined a set period to hold those funds or credit line a sufficient number of days to finalize. This hold period varies greatly and there is no set standard.

This is very egregious when you should happen to use a debit card to secure the room as the hold amount is deducted from your account at that time and is NOT available for your use until the transaction is finalized or cancelled (and by the way, a merchant does not have the ability to cancel an authorization). Guess who gets to use your money while you can't?

This is why many properties have warnings about using debit cards. There is nothing they can do to change your bank's policy, as it should be. Unfortunately this policy can be buried so deep in the organization, no one you're going to reach by phone will have the ability to explain let alone change what's happening. If you're lucky, they may be able to dispute the authorization charge and return the amount to your account or bump your credit line, but I wouldn't count on it.

Just like PCs (see http://meyerweb.com/other/humor/osair.htm), this is another example where we've jumped on board to a new technology without the proper safeguards in place protect the user and we get outraged when things go wrong.

Andriyko

Merchants can cancel authorizations. The easiest thing to do is ask them to use the pre-authorization or cancel it if they initiated a new charge.

Regarding the limit for how long the authorizations can hold - I believe payment systems such as VISA and MasterCard allow up to 30 days for banks to issue debits for pre-authorized amounts. Most banks (especially in Europe) hold the frozen funds for the maximum term fearing that when the debit arrives the customer won't have any funds in the account. This is explained by the fact that people in Europe prefer debit cards while in the USA, for example, credit cards are more popular. In the case of the former it means that it is the funds of the customer that get frozen/debited, while in the case of the letter it is the funds extended as the credit that are used. If there is nothing on the debit card when the merchant's bank sends a debit it means that the customer will go into overdraft, which are (a) very expensive, (b) may not be allowed for the account.
I think that people should learn to insist that merchants (especially hotels) cancel pre-authorizations despite their assurances that they are not actually debiting the money but only ask the bank to hold it for some time - depending on the customer's bank 'some time' may last for up to 30 days.

To comment on what RogerD408 posted - using a debit card to secure a reservation is the worst as the customer's own funds get frozen. However, merchants can and do cancel pre-authorizations. The thing is that many don't know how to do it or don't understand what you're asking them to do. Most people don't even know the difference between the pre-authorization and the actual charge so when they call the merchant they ask them to refund the amount, to which the merchant reply that they have not charge anything and that the customer's bank will release the funds within a certain period. That is all very nice, but they are required to cancel pre-authorizations if the customer so requires - it is called voiding a transaction. I successfully did it many times.

RogerD408

I asked this very question of our Merchant Account processor when I was in retail, and told there was no function to cancel a pre-authorization. Yes, the merchant should have used the previous transaction to process the final charge, but there are many people out there that don't know what they are doing and they just start all over each time.

Another startling revelation was processing a credit transaction can take a totally different path to your account. So even though a charge hits your account almost immediately, a credit can take weeks before your account sees the credit and then more time before showing up on a statement. Again, these rules (so I was told) are set by the card association and/or your bank. The merchant does not have control here.

Andriyko

You were misinformed I am afraid. I successfully had transactions voided at stored, by hotels and other merchants. After the transaction is settled it will take a refund to see your money bank, but as long as it is still a pre-authorization it can be easily voided. Authorization codes can be canceled either by the merchant on its terminals or by calling the merchant's bank.

RogerD408

I assure you I pursued all avenues available so I guess we will just have to chalk it up to different systems offering different options. So another case of YMMV.

bakoboy

We recently went on a cruise and my Citi card was charged for drinks, spa treatments, etc. We've been home two weeks now and paid the amount in the summary bill from the cruise line that was presented to us before we got off the ship. The billing statement appeared to be correct.

However, there are several charges that are still "pending". When will these drop off, or am I going to have to call Citi, or the cruise line, to get them removed? The pending charges appear to be duplicates of charges included on the final billing.

Or should I just wait it out?

dascc

wait it out. No reason to worry unless they post. My CC had the same thing after a Carnival Cruise earlier this year. they all dropped off eventually.

RogerD408

Just wait it out. No one is going to be able/willing to remove the holds. The CC/banking industry has designed the system to eat your funds for as long as they can. Charges take a fast track to hit your account ASAP. Credits take a different route and may be weeks to hit your account. Holds are supposed to disappear when the merchant finalizes the charge (think restaurants when they run your card before you tip and sign off). However, some don't bother to match up with the authorization and just puts through a new charge leaving the authorization to age off, again this can be weeks.

If these amounts are keeping you close to your limit, a chat with your CC may get you a temp/perm increase in your limit to allow you to continue using the card. Threatening to move your spend to another card just might get them to move quicker.

xenole

9 days so far for the CP at LAX.