Setting Property Refund Policies

By William May
Published: 11/08/12 Topics: Comments: 0

Because policies vary by property good managers ask Owners their preference about guest refunds and cancellations. It is not always possible, and most owners do not want to be involved in the small but inevitable situations where guests are due, or demand refunds.

Cancellation Policies:

For "Deadline" cancellation policies, such as "Cancellable up to 7 days prior to occupancy" guests are allowed to cancel without reason but prohibited from doing so after the deadline.

For "Non-cancelable" bookings, such as during high seasons, refunds are not allowed simply because guests change their minds. This is necessary to avoid loss of revenue not caused by the property, owner or manager.

Resell Policy: In all cases, upon Guest request, Managers will attempt to "Resell" non-cancelable dates in order to refund the Guest's payment, less a rebooking fee. The possibility of resale is not guaranteed.

Legitimate Reasons:

For valid problems, such as the loss of hot water, kitchen fixtures, etc. managers seek resolution by relocating guests, offering discounts or rescheduling but may offer partial or full refunds, including for non-cancellable bookings.

No-Fault Reasons:

When guests seek refunds due to factors beyond the control of the property, owner or manager such requests are usually refused. In the spirit of Goodwill, the manager may offer minor credits, vouchers for future stays, gifts or other courtesies.

Owner Choices:

Even during non-cancelable dates, some owners prefer to extend refunds for most any reason. Rather than make unilateral decisions Mangers ask Owners when they would prefer refunds be granted.

Evaluating and setting reasonable policies is something that must be done before a single guest is booked. Only with pre-planning can guest refunds be knowingly administered.

• For aborted stays (Guest departs or is evicted for noise, parties, etc.)
• For which of these would you issue a refund? Would your owner clients agree?
• For money? (Just realized I can not afford it)
• For change of plans? (Going to Disneyland instead)
• For area conditions? (Lack of sun or snow)
• For bad weather? (how bad)
• For road closures?
• For car break downs?
• For travel plans (forgot to buy airline ticket)
• For dissatisfaction? (Just did not like unit)
• For invalid complaints? (Clean towels, not thought clean)
• For insufficient space? (Brought undisclosed extra invitees)
• For amenities? (Wanted, but did not specify HBO)
• For inoperable amenities? (such as WiFi)
• For event cancellations? (such as concerts) i
• For parties not allowed? (More people than disclosed)
• For pets not allowed? (Not requested at time of booking) For smoking not allowed?
• For health of family member? (not traveling with guest)
• For death of a family member? (not traveling with guest)
• For health of a planned fellow traveler?
• For death of a planned fellow traveler?

Keep in mind that refunds come directly out of the property owner's pocket.

Author: William May – Volunteer, Vacation Rental Association
Blog #: 0333 – 11/08/12