If you’re a renter whose landlord insists on a paper check in the age of credit cards, auto-pay, and mobile payments, you aren’t alone.
In fact, your dilemma is so common that RadPad, an app that lets users browse real estate listings, has released a feature that translates your credit or debit card payments — and soon, according to the press release, Apple Pay — into paper checks.
It’s a pretty simple concept: You pay the app, using Visa, Discover, or MasterCard (American Express should be available shortly), and then the app takes the responsibility of printing out a paper check and sending it to your landlord, with your information attached so they know it came from you. You can set it up to pay automatically every month or not, and your landlord doesn’t need to sign up for the app.
The app also keeps track of your payment history, and sends a notification when your landlord cashes the check.
It sounds easy … so what’s the catch?
The catch is the fees.
RadPad isn’t free. The app costs $US4.95 a month for debit cards, and 3.25% of your rent for credit.
“We really wish we didn’t have to charge you, but we do in order to cover the fees that are incurred to process your payment,” the company writes in its FAQs. “We also have to cover the cost to print and mail your check each month.”
The nearly $US5 flat rate for debit is straightforward. But if you’re looking for a payment method with some sort of insurance and to “earn those credit card points even faster,” as the site uses as one reason to justify its fees, you’ll want to pay with credit. 3.25% doesn’t sound like all that much, so I used the calculator handily provided on the site to figure out what it would cost to pay credit.
- For a $US700 rent, you’d pay $US22.75.
- For a $US1,500 rent, you’d pay $US48.75.
- For a $US2,800 rent, you’d pay $US91 (!).
In order to pay as little for credit as you would to use debit ($4.95), your rent would have to be about $US152 a month. Considering that the average US national rent in 2013 was $US962 — that’s a $US31.27 credit card fee, by the way — $US152 is laughable.
For people who aren’t even sure where their checkbooks are or where stamps are purchased, RadPad is a cool concept. But that convenience comes at a steep price.