Customize your experience by selecting your role:
Owner, Property Manager, or Traveler
I don't like to keep security deposits if the guests cancel, but I feel I have the right to do so if I cannot rent out their dates. What if they cancel within a week or 2 of their dates and paid you in full? Do you keep their entire payment if you can't rent out their dates or just keep the security deposit?
Hi blue neptune,
As you wait to hear from other Community members, this discussion about advance payments/cancellations may be of some interest.
All the best,
I clearly state in my policy and in my contract that I will refund the rental up to 30 days prior to check-in. After that there are no refunds for any reason; however, I offer them two types of travel insurance. The standard type policy lets them cancel for certain specified reasons such as illness, death, etc. I also offer a cancel for any reason policy. This policy returns the m 75% (versus 100%) if they cancel for any reason (not a covered reason) up to 48 hours prior to check in. They gt back a 100% if it is a covered reason. I strongly encourage them to purchase the insurance since it also covers them for hurricanes or major storms. My policy clearly states that even in the event of a forced evactuation there are no refunds so a policy is their best protection. So far this has worked well and I have not experienced any problems.
If you make it too easy, people will often cancel becasue one of the friends decides not to go, etc. If you make it cost, the friend will either decide to go or be faced with paying their share anyway so it discourages cancellations.
My guests pay a $300 reservation deposit to secure their dates. It is not refundable for any reason. 30 days prior to occupancy, I require full payment. This payment is only refundable if the property can be rebooked for the same dates. This policy keeps out people who are "looky loos"--and cannot make up their minds. Their are hotels for that kind of traveler. This is our second home, and we are busy--so as a result, I have very few cancellations.
I am thinking I need to revise my non-refundable deposit policy and I like what you have written, Nancy. If I am reading correctly, even if you rebook the time covered by the cancelled reservation, you do not refund the $300.00. - Is this correct? My recent cancellation, which is causing my reassessment, was for medical reasons. At that point, they had only paid the deposit, which is clearly non-refundable in my contract. However, my deposits are 25% of the total and I am feeling guilty for keeping their deposit because I was able to rebook most of the time they requested.
We require 1/2 of the rent before we make the booking. The second half is due 60 days before the rental begins. And, we have a no refund policy. However, for a fee of $300 we will attempt to re-rent a person's dates for them. This has only happened 3-4 times in 5 years. Each time we have been able to re-rent the dates. One time a fellow was physically injured a week before his stay. In that case, we let him transfer his weekend to a different, similarly priced date a month later.
Our renters know our policy up front. It keeps out the folks who want to reserve dates, just in case. As some one else said, hotels service that market.
We do this because most of our summer rentals are booked between December and March. If someone would book and cancel we could very well miss our prime booking season. Also, the rental income is earned at the point the booking is made. Therefore, it is ours to spend at that time. And, we don't have to keep such a large reserve to cover cancellations.
Thank you for sharing your policy. If I am reading what you say correctly, you are essentially charging a $300 cancellation fee if you can rebook for the reservation. If you cannot rebook, the entire reservation payment is forfeited. - Is that correct? Have you ever found that people are hesitant to pay the full amount 60 days before arrival?
Hi Blue Neptune,
Our policy is that we will refund the fees paid IF AND ONLY IF the house can be re-booked. If re-booked at a lower rate, then we only refund the amount received from the new tenant (and keep the difference). If we cannot re-book, then no refund at all.
Fortunately, in 4 years, I have only had 1 cancellation and we re-booked the house at the standard rate, so they got their money back.
Like laughscott, our policy states that a we will refund only if the property can be re-booked, and if it is re-booked at a lower rate, the refund will be for the amount received. If this is stated in plain language and highlighted in the lease, it should not be a problem. I obtain half of the rent upon booking, and the balance 30 days prior to occupancy, although I have thought of changing the balance to 60 days prior, to give us a better chance of re booking in case there is a cancellation. Depending on where your rental is should determine your balance date. We are in New Jersey and our high season is only about 11 or 12 weeks long, with about 7 mid season weeks. The rest of the year is low season so we really depend on the high and mid season rentals.
Our lease agreement states clearly that the cancelling renter will receive a full refund MINUS a $100 processing fee IF the house is rerented for the full amount of the rent posted on the listing. If the house is not rerented, there will be no refund. We require full payment 60 days prior to arrival.