cheapest credit card processing for real estate

What are the cheapest rates for credit card processing for Real Estate companies? 1.1% plus $0 per transaction fee is the lowest MasterCard interchange rate as of April 2009. The rate is the same for consumer debit and credit cards for real estate transactions, sales or rentals. You can qualify for this interchange rate by having a renter sign up for recurring billing to their credit card online.

MasterCard 2009 interchange

It’s important to understand that 95% of your fees are in interchange. Therefore in order to have the lowest costs, you need to qualify for the lowest interchange rates. Every transaction for your real estate company that qualified at 1.10% could just as easily qualify at 2.04%. How does this happen? There are three main reasons:

1. Lack of education: The current MasterCard interchange rate guide is over 110 pages. There are endless rules for different cards, different industries, and if someone made a mistake- whether the salesperson or someone further down the line, who will recognize that one has been made? Not the merchant. And in many cases, not the salesperson. Many processors just avoid the whole issue by giving sales reps a few different price plans that don’t require them to have the in-depth knowledge to help you qualify for the lowest rates.

2. Wrong price plan- the lowest rates are reserved for larger volume firms. But some payment processors don’t offer these price plans regardless of how big you are. Or, if you’ve been with your processor a long time, they haven’t lowered their profit margin, even though the industry is much more competitive than years ago.

3. Lack of interchange management- no one is watching your back. if you get a great price plan, but you aren’t qualifying for the lowest interchange levels, you’re paying more than you need to. A qualified professional understands what levels of interchange YOUR BUSINESS qualifies for, and reviews your transactions to make sure you hit them.

As with all processing, a merchants actual fees include:
– an percentage per transaction
– a per item fee (in this example, $0)
– a merchant discount
– Visa/MasterCard dues and assessments

Additional fees typically include:
– merchant monthly statement fee
– network or batch/settlement per transaction fee
– AVS address verification per item fee

Real estate companies tend to have larger transactions than many other types of merchants. With the increased preference for credit cards over checks, this can be a hit on the bottom line, with the wrong pricing plan.
credit card fees/ CREDIT CARD CHARGES = effective rate
What’s your effective rate? It’s probably safe to estimate that it should be less than 2%.
. It could be much lower, depending on the mix of credit card types presented. The interchange rate used in this example is for consumer credit or consumer debit cards. Rewards cards, corporate cards and other types will qualify for different interchange rates.

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