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How To Lease A Car As An Expat In The USA

America is known as the land of the automobile, and for anyone who has spent time in the States, the reasons for this are obvious. It’s an enormous country, and settlements are still set wide apart from one another, particularly by European standards. You may remember the old joke about 100 years being a long time in America and 100 miles a long way in Britain! The USA has a good rail network, although it’s such a huge country that many people prefer to fly if they’re travelling from coast to coast, for instance. However, most people rely heavily on their cars. If the local grocery store is 45 minutes’ drive away, walking isn’t going to be an option – and the infrastructure just isn’t there for public transport.However, if you’re an expat in the States, you might find yourself running into an unexpected problem – namely, that it can be surprisingly difficult to lease a car. And that’s a major problem if you’re going to live in the States for work, or if you’re visiting on business and need to commute.

Why is this the case? Problems may occur due to your credit history – or lack of one. Car hire companies in the US have access to some of the credit records of US citizens, but they don’t have access to your home nation credit history if you’re an expat.

Why can’t I just use my debit card to hire a car, you may ask? That will automatically take the cost of the rental hire out of my account, won’t it? Well, yes, it will – but you’re an honest customer who has no intention of returning the car with an empty tank, bringing it back with a dent in the side… or not bringing it back at all. If a hirer brings the car back empty, then there might not be enough cash left in the bank to put petrol into it, or their insurance might not cover the cost of a ding. This means that a debit card is a risky proposition for rental companies to accept.

As Thrifty Rental Car explains on its site:

“Renting a car to someone with no credit card is risky for rental car companies. Not having a credit card is a red flag that you may be a credit risk.”

It must be stressed that it’s not impossible to use your debit card; car hire companies don’t want to turn down your custom, after all. However, you will face a few more difficulties if you choose to do it this way. Some car hire companies have historically refused to take cards that don’t have a Visa, Mastercard or Discover logo on them. You’ll almost certainly face a credit check at the desk, and the company may put a hold on your account for up to $350 to cover any emergencies, on top of the actual rental cost.

They’ll unfreeze it if those contingencies don’t occur, of course, but that process can take up to three weeks, which is frustrating if you have limited funds and need the money. You’re also likely to need proof of insurance – and the car rental company may need to call your insurer to check this – as well as a form of identification and proof of return travel such as a cruise or train ticket. Companies such as Enterprise, Alamo and National are flexible when it comes to hiring from non-airport locations, but they might put their foot down if you’re hiring from, say, LAX or Newark.

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In addition to this, using a debit card may also restrict the kind of vehicle you’re able to hire; top of the range cars such as convertibles probably won’t be an option. Car hire companies might exclude you on the basis of age, too.

So what’s your best option if you don’t have a credit card and need to use your debit card? Primarily, it’s a good idea to check out your car hire company’s policies well in advance. You can do this by reading the policy small print on the ‘locations’ tab on the company’s website – as we’ve mentioned above, policies are likely to depend on where you’re hiring the car from, so location is an important factor.

There is some good news – as of February 2019, some of the big travel companies are easing the restrictions outlined above. Dollar and Thrifty travel say that they’re relaxing their conditions for debit card users and won’t require a credit check, or proof of return travel. They’re also rolling out a policy which reduces the minimum customer age from 25 to 20 years old.

“This is yet another way we can do our part to help minimize any stress when traveling, especially for our customers who choose to use a debit card,” said Dollar’s Senior Vice President, Susan Jacobs, "Listening to our customers and providing a better experience is in our DNA here at Dollar, and that's why leading the industry with this big policy change is so important to us."

This is a big shift since previously, Dollar wouldn’t accept customers with a credit score under a certain number of points and were subject to the same policies as other car hire companies. Dollar is reacting to a change in credit habits – 29% of American people currently don’t have a credit card, and recent polls indicate that more than this prefer to use debit cards.

However, don’t relax too soon – you still won’t be able to use a debit card to book a reservation in the Tri-State area or parts of New England. Plus, the eased regulations don’t apply to every car hire company; Hertz still prefer a credit card and will carry out credit checks.

Dollar’s policy change may well prove to be industry-leading. But in the meantime, do remember to check out the small print of your particular car hire policy well in advance of your trip, to avoid any unnecessary hassles at the hire desk.

Have you lived in the USA? Share your experiences in the comments below, or answer the questions here to be featured in an interview!

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