If you've rented a car or hotel room, you probably have heard the phrase "guaranteed by credit card." However, if you're new to the world of travel, you may be unfamiliar with this phrase. Learning what it means to have something "guaranteed by credit card" helps you understand the payments for which you are responsible and may help you avoid unnecessary charges to your credit card.


Offering your credit card when reserving the purchase of a good or service means that you are committing yourself to pay for the good or service at a later, agreed-upon date. For instance, if you reserve a car or hotel room, the company may ask you for your credit card information to guarantee that the car or hotel room is available for you on the date requested.


When the company takes your credit card information, it’s not immediately charging you for the rental in the example above. However, it’s using your credit card information to have the ability to charge you for breaking the reservation to ensure you follow through on the commitment or abide by existing cancellation policies. This helps the company predict availability and ensure that people who commit to purchasing the good or service offer fulfill their obligation.

Best Case

You don’t necessarily have to use the same credit card used to guarantee a good or service to pay for it. When you arrive at the company offering the good or service you’ve agreed to purchase, you usually can present a credit card other than the one used for the guarantee. If you are using a different card for a hotel room rental, you should present the new card at check-in rather than when checking out to ensure the guarantee card isn’t charged for incidentals.

Worst Case

It's possible a company can charge your credit card for a good or service you did not use. For instance, assume you reserved a rental car and guaranteed it with a credit card, but you got stuck in the airport at a different city and could not pick up the car on the agreed-upon date. You also did not call the car rental company to explain the predicament and change the pick-up date or cancel the reservation. The company could have charged your credit card for the rental even if you did not use it. If you show up a day later to pick up the car, there may be no cars available, even though you were charged. Rental car companies often don't require a credit card guarantee to reserve a car. However, hotels may charge you for a night's stay even if you don't use the room but did not cancel the card-guaranteed reservation by a designated time.