At this point, unfortunately, you don't have a contract with this person and should have never marked the days as booked on your calendar. They never send it back with signature to there is no commitment. Immediately put these days back up available on your property page. You need to set your rules and adhere to them at all times. This are my rules and they are non-negotiable.

1. Renter informs me they want to book.

2. Renter is sent an online reservation form to sign and give me credit card information.

3. Renter has 48 hours to return SIGNED RESERVATION AND DEPOSIT.

4. Renter is required to send 1/2 of the rental fee and a signed contract to secure the dates. I will not take one without the other.

5. Credit card is run and reservation confirmed.

6. Days are blocked off of my calendar.

I continue to market the property until I receive both and renter is aware I continue to market the property.  This is my payment policy:

1/2 of the rental is due at booking and the balance is due 30 days prior to check in.

Damage deposit is run as a credit card authorization only on the day of check in. It is only charged if there is damage.

Sophie and kiawahcottage are both operating on the assumption that you do not have a contract because the renter has not signed and returned the written rental agreement to you.  This was my first assumption also.  Upon reflection, however, I am not so sure.  You may in fact have an oral agreement to rent the property to her.

A contract is a "meeting of the minds" on the essential elements of the agreement.  It is formed when one party makes an offer and another party accepts that offer.  To be enforceable, a contract does not have to be in writing and it does not have to have all of the details enumerated.  Contract disputes arise all the time because it was not clear what all of the terms of the contract actually were.  You advertised your property.  You and this woman discussed her rental of it and the terms of the rental.  She sent you a deposit which is evidence of her offer to rent the property from you.  Was the deposit paid by credit card or check?  If it was paid by check, did you deposit or cash it?  If the deposit was paid by credit card or if you have deposited the check, I think that you may have accepted her offer to rent the property even though she did not sign and return the written rental agreement to you.

You asked if you can cancel the contract in 48 hours if you send the deposit back.  This indicates that you consider a contract to have been formed.  Assuming that you do have a contract, a contract can only be cancelled according to its terms.  From what you have posted, you gave the renter the right to cancel the contract without penalty as long as she does so at least two weeks prior to the date that the rental is to commence.  Did your discussion or correspondence with this person (before she paid her deposit) also give you the right to cancel the contract without penalty?

I would chalk this up to "live and learn."  I think that you have to wait and see what she does.  We all learn as we go along.  This is my third year of handling the rental of my property myself and I have made changes to my booking confirmation letter and rental agreement each year because of different situations that arose.

To prevent being in such a situation in the future, you must make it absolutely clear that there is no contract until the renter has paid the deposit and signed and returned the written rental agreement.  I only accept personal checks and do not accept credit cards.  When I receive an inquiry from someone through VRBO, I first do an internet check on them before responding.  I then telephone them and talk to them in person.  If we both want to proceed with the booking, I explain the procedure to them.  I make it clear that I will hold their reservation for seven calendar days and that I must receive their deposit along with the signed rental agreement within that time period.

After talking to them on the phone, I immediately e-mail them a booking confirmation letter and rental agreement.  Among other things, the booking confirmation letter states, "In order to hold your reservation, your deposit of $xxx.xx (representing one-half of the rental rate and one-half of the Maine State Lodging Tax) and the signed rental agreement are due within seven (7) calendar days of the date of this letter. If the reservation deposit and signed rental agreement are not received by this date, your reservation will be cancelled and the cottage will be made available to rent by others."

Good luck!