Why won’t VRBO pay for my lost valuables?

Jovanka Syedy is the owner of a short-term rental newly listed on VRBO.com, and her first experience is a nightmare — a stolen credit card, a thief, and a 30-day hold on her payment.

Question: I am a new short-term rental owner, and just listed my house at VRBO.com. The first guest that booked through VRBO was a thief. I immediately filed a police report and tried to contact VRBO by phone and email several times.

This is my first transaction with VRBO, so it is holding my payment from this booking ($818 + $250 security deposit) for 30 days. Because the credit card the guest used may have been stolen, VRBO says I might not receive any payment at all.

Next, I require my guests to purchase $99 insurance (coverage up to $5,000) when booking my house. But the VRBO system will allow renters to book my house without buying the insurance if the booking is less than 24 hours before arrival. I didn’t know this, and thought I was doing a guest a favor to let her book on the same day. I received no notification from VRBO that the mandatory insurance purchase had been rescinded. So there is a flaw/loophole on the VRBO site that hasn’t been fixed, and I have to suffer the consequences.

This insurance would have covered the $2,885 cost of the items the renter stole from the house, plus what I paid the locksmith to change the locks.

When I finally reached someone at VRBO, the representative said VRBO is an advertising company; hence, they are not responsible. I was also told it’s the responsibility of the homeowner to screen the renters. This was never made clear by VRBO and I believed it screened its applicants. I didn’t receive any reply to my last email.

Between the rental charge and security deposit paid to VRBO, the cost of the stolen items and the cost of changing the locks, I am out $3,953. Can you help me get VRBO to return this amount to me and provide a guarantee that it will not later chargeback the rental cost and security deposit? I believe this is their fault. I’d also like the renter’s profile removed from the VRBO website so she can’t harm other homeowners. —Jovanka Syedy, Corona, Calif.

Answer: I’m sorry to hear about the loss of your items. I’m glad you filed a police report, and hope they will do something to help.

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It’s not clear to me why you believe the credit card the renter used was stolen. From the correspondence shared with us, there is much speculation regarding what would happen if the credit card was stolen, but nothing that confirms it was a stolen card. Unfortunately, VRBO has no power to influence whether a chargeback is made. The agreement between the bank that issued the credit card and the cardholder will govern the processing of any chargeback. Some cardholder agreements will reimburse the cardholder while not recovering the charged amount from you, but others will, as VRBO mentioned, charge the amount back to you.

If there is a chargeback, your only recourse is to go after the thief. You’ve already taken the first step by filing a police report. If you can locate the thief, you can also sue in small claims court to recoup your loss. VRBO indicates that their credit card processor, VacationRentPayment, will try to help you recover the funds, but it’s important to remember that banking law and the cardholder agreement dictates the process that will be followed if the credit card used to pay your rental fees was stolen.

When you finally heard back from VRBO, the representative informed you that the site is merely an advertising site that helps you receive payments in a secure manner. All screening of your guests and any problems resulting from your rentals are your responsibility.

I visited the VRBO site and reviewed their terms and conditions, and it does indicate that this is your responsibility:

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User verification on the Internet is difficult and we cannot, and do not assume any responsibility for, the confirmation of each user’s purported identity. We encourage you to communicate directly with a traveler or member through the tools available on the Site, though even this does not assure you of the identity of the person with which you are communicating. We further encourage you to take other reasonable measures to assure yourself of the other person’s identity and, for travelers, of the property and relevant details of your booking or proposed booking.

Additionally, the site also indicates VRBO “is not a party to any rental transaction and assumes no liability for legal or regulatory compliance pertaining to rental properties….” Further, it states that they will determine “at our sole discretion” whether they will provide information to assist with investigations, litigation, or administrative proceedings.

This last piece of information is most disturbing. While the VRBO representative told you that they would provide information to help you get compensation after the theft, the company actually stipulates that it doesn’t have to — and might not, if it doesn’t want to do so.

The representative also referred you to the information regarding the purchase of insurance by the renter. He insisted that you would have received information that the rental was within 24 hours prior to the rental, and that she would not be able to purchase the insurance through the site. You said you received nothing. He also claimed they had tried to call you several times, but you say you never received the call. I recommend confirming by phone and in writing that the contact information they have for you is correct.

The policy of keeping the rental and security deposit funds for 30 days was explained to you as “protecting both you and the renter.” I certainly understand how it might protect the renter, but I’m confused how holding an owner’s money for 30 days provides any protection to the owner. I’m sure it provides some interest income to the processor, though.

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There is an owner’s toolkit online for all the HomeAway portfolio sites, which might have provided you with some information on starting your rental property business, but much of it concentrates on how to create a good advertisement. The information on insurance, verifying identities, and other important limitations is there — it’s just hard to find.

I think all the HomeAway brands could be far more clear about what they actually do — and don’t do — for both renters and owners.

I recommend reading all the materials provided to you (and those available online) before entering any kind of contract. If anything is confusing, ask questions. If the company isn’t providing the services you need, find another business that will, or understand that you have to do much of this work yourself. A quick online search revealed multiple sites where both vacation home owners and renters complained about the lack of verification on the HomeAway sites.

In a follow-up email you requested to speak with a supervisor, and the representative who replied declined, saying he represented management. At that point you could have reached out to the Homeaway.com executives we list on our site.

Instead, you reached out to us. While we are certainly sympathetic to your predicament and wish there was something we could do, in the end, you entered into an agreement with an advertising site, and we are unable to help. Hopefully, you have an insurance policy that covers a rental business, and it can assist you with recouping some of your losses from the theft. The police report should help. We hope this unscrupulous renter will be caught and punished — and you will be able to recover some of what you lost.

Michelle Bell

Michelle worked in the travel and hospitality industry for almost two decades. Born in Germany, she has lived in 15 states and two foreign countries, and traveled to more than 35 countries. After living and working in Southeast Asia for several years, she now resides in New Orleans.

  • AAGK

    Great article, Michelle! Your intuition and analysis are perfect. If someone is serious about receiving reimbursement for a wrong committed, they need to be transparent. This includes taking all necessary steps like filing a police report if there is criminal activity involved, following up with the Detectives, etc. With these rental cases, owners are giving their house, possibly their largest asset, to someone for a small rental charge for a week or so. Owners must be beyond diligent in understanding every detail bc the loss potential is so major.

  • Regina Litman

    Why aren’t renters able to buy the mandatory insurance less than 24 hours before the rental began? Is it a web site glitch, or is it bacause more time is needed to underwrite and bind the policy? The arrticle confirmed the under-24-hours situation. But I wanted to know why, and this was not answered for me.

  • AJPeabody

    Want to bet that the thief is never found? It is quite likely that the individual looks for inexperienced first time renters, makes a last minute buy to prevent adequate vetting, and steals what isn’t nailed down. This was clearly planned and the chance that this was a valid credit card transaction is nil.

  • CC Gorman

    This entire post could be replaced by saying–
    “This is a consumer advocacy site. We aren’t here to help you with your business endeavors; however, we can tell you that you should understand the terms of a contract before you agree to them.”

  • AJPeabody

    As this was a first time renter on VRBO, we could consider the OP as a new consumer of VRBO services.

  • AAGK

    I doubt this is true across the board. Sounds like this Owner didn’t select the terms that would be most favorable to her. These options can be customized. I was looking at properties the other day and they all required refundable $5k damage deposits, regardless of rental date. This owner received a benefit for her looser terms in that her property appealed to more renters. The downside is less security and possibly less desirable applicants.

  • Rebecca

    I’m not 100% sure, but I have a very good guess. Most likely the insurance company considers a last minute rental like this a high risk and actually specifically excludes any rental with less than 24 hours notice from coverage. It isn’t that the VRBO site has a glitch or something, it’s because if the OP filed a claim, it would be denied due to the terms, so it would be pointless to purchase it.

    The insurance company knows it’s a high risk transaction. The OP apparently does not. I am baffled that someone would just jump into such a huge investment having done no research or using a new ounce of common sense.

  • cscasi

    It’s obvious the owner did not read and understand the terms of VRBO. And, if there were questions, she should have contacted VRBO and asked questions until she was satisfied that she knows all she needs to know. Too many people “assume” things that may or may not be true when they sign up for things or sign contracts without fully understanding things. This was an expensive lesson.

  • Lee

    This OP should have home insurance and rental business insurance (or, whatever insurance is needed to conduct such a business) and should be filing taxes on any income received from said rentals. I know of a number of people who do not report this income whether it be from VRBO or Airbnb or any other such listing site.

    I am not assuming the OP is not reporting the income, or planning to, just mentioning it because often they don’t and such folks, skirting the law themselves (again, not accusing the OP), will not take care in the important details of a transaction.

    If operating legally, the OP would have such insurance – or, certainly should. And, I agree, how does one hand over a home or apartment full of private possessions without going over the terms and conditions with a fine tooth comb. That is truly baffling.

    I guess the company believes the cc is stolen given the thievery by the guest – hopefully, that will be clarified and it will have been a legit cc and she can at least get her payment from the company.

  • pauletteb

    VBRO? More like VBROh, no!

  • Blamona

    And yet vrbo/Expedia charges a service charge on both ends (owners and renters) and they keep their commission no matter what. And make it sound like insurance and customer service 24/7. I’ve learned to hate outside booking companies

  • Altosk

    Publish the name of the renter.

  • jsn55

    This is a scary story. If you’re going to become a “landlord” on VRBO or any other online site, you have to carefully read and understand all the terms that relate to your rental. These are internet transactions and nobody will do your homework except you. The concept of vacation rentals is a good one, but all parties are on their own all the time I am so sorry to hear that your first renter was a thief.

  • DChamp56

    There’s always someone that wants to take what you rightfully worked hard for and earned, whether it be VRBO or bad renters.

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