In this case
- After canceling a stay at a small guesthouse in Mexico, a representative promises Betsy Webster a refund, minus a small fee.
- Despite multiple emails and assurances, the money never arrives.
- Now, she needs to find a way to get her money back from the small business that seems to have let her refund fall through the cracks. How can she do that?
After Betsy Webster cancels her stay at an apartment in Puerto Morelos, Mexico, she’s offered a partial refund. But the money never comes. What should she do?
Question
My husband and I reserved a room in the Layla Guesthouse in Puerto Morelos, Mexico, earlier this year but had to cancel for personal reasons. We canceled within the required time frame and requested a refund (minus a 6 percent cancellation fee) but have yet to receive it, despite assurances from the guesthouse that it was being processed. Can you help us? — Betsy Webster, La Grange Park, Ill.
Answer
You should have received your refund by now. But I think I know the reason for your delay.
The Layla Guesthouse is a six-room boutique hotel that was in the process of turning itself into longer-stay apartments when you contacted me. Your refund may have gotten lost in the shuffle.
The guesthouse applies a cancellation policy that’s similar to one of a cruise line or tour operator. If you cancel within 20 days of arrival or more, you’ll get 94 percent of your entire stay refunded. (The 6 percent cancellation fee covers the credit-card swipe fee and currency conversion.) If you cancel between 19 and 14 days before your arrival date, you’ll get 70 percent back. If you’re between 7 and 1 day, it goes down to 25 percent.
You knew about these fees and agreed to them. In some ways, they are more generous than what you would have gotten with Airbnb and Vrbo. In other ways, they are not. For example, none of the other platforms charge you 6 percent cancellation fees.
Read more insightful reader feedback. See all comments.
I would normally say that you could have avoided this problem by using one of the vacation rental platforms, but I’ve seen more than a few refund problems with Airbnb and Vrbo. Companies are quick to take your money and slow to return it, regardless of company size.
It looks like you canceled your reservation by email well in advance of your stay and received confirmation that the cancellation was being processed. You followed up several times, only to be told by the guesthouse that they were experiencing technical difficulties, then that your refund was being processed. However, you never received the money.
If a business promises you a refund in writing but doesn’t deliver, you may be able to talk to your bank about a credit card dispute. A chargeback under the Fair Credit Billing Act would help you recover all of your money. A dispute department will view your email from the hotel confirming a refund is being processed as a credit memo and claw back the money.
This case involves a small, independent guesthouse. Do you have different expectations for customer service from a small business versus a large corporation like Marriott or Hilton?
Have you ever been charged a fee to get your own money back, like the 6 percent cancellation fee in this story? What are your thoughts on this practice?
When a business promises a refund but doesn’t deliver, how long do you wait before filing a credit card chargeback? Share your strategy in the comments.
After months of waiting, you contacted me for help. My team contacted Layla Guesthouse on your behalf. You also followed up with the guesthouse to press your case. Eventually, a guesthouse representative reviewed your case and issued a full refund. (Here is our best guide to renting a vacation home.)
Your experience illustrates the importance of persistence and following up. It also shows the value of a paper trail. By keeping a record of your correspondence with the guesthouse, you were able to prove that you had canceled your reservation and were entitled to a refund. In the end, your patience and determination paid off.
A quick guide to hotel cancellation policies
| Hotel Chain | Standard Cancellation Policy |
|---|---|
| Accor | Noon on the day of arrival |
| Best Western | Cancel 24 hours before arrival |
| Choice Hotels | Varies by property, but often 24 hours before arrival |
| IHG | Same day or 24 hours before arrival for flexible rates |
| Wyndham | 24 hours before arrival for flexible rates |
| Hilton | 24-72 hours before arrival for flexible rates |
| Hyatt | 24-48 hours before arrival |
| Four Seasons | Varies by property, can be up to 72 hours before arrival |
| Marriott | 48 hours before arrival |
| Radisson | Varies by property, but often 24-48 hours before arrival |
| Disneyland Resort Hotels | 5 days before arrival |
| Walt Disney World Resort | 5 days before arrival |
How to get a business to send a promised refund
- Get the refund promise in writing. The single most important piece of evidence is an email or written message from the business confirming they will issue a refund. This becomes your proof of a credit owed.
- Keep a detailed paper trail. Save all correspondence in a single folder. This includes the original booking, your cancellation request, the company’s refund promise, and all subsequent follow-up messages.
- Follow up politely and consistently. Send brief, professional emails every week or two to check on the status of your refund. Reference your case or reservation number and remind them of their promise.
- File a credit card chargeback. If weeks turn into months, it’s time to contact your bank. Provide them with your paper trail, especially the written refund promise. Under the Fair Credit Billing Act, your bank can treat this promise as a credit memo and recover the funds from the merchant.
FAQs
- Why was there a 6 percent cancellation fee? The guesthouse charged this fee to cover its own non-refundable costs for credit card processing and currency conversion. This is an unusual policy, as major booking platforms typically do not charge guests a separate fee for cancellations.
- When is a credit card chargeback a good option? After you’ve waited months for a refund that was promised in writing. An email from the business confirming a refund acts as a “credit memo.” This is powerful evidence you can provide to your bank to dispute the charge and recover your money.
- Is it better to book with a large company or a small guesthouse? This story shows that refund problems can happen with any size of company. Both large platforms and small businesses can be slow to return money. The most important thing is to have a good paper trail, no matter who you book with.
- What is the most effective tool for getting a promised refund? A complete paper trail. Having a written record of your cancellation and, most importantly, the business’s promise to refund you is the key. This documentation proves your case and is your strongest asset in any dispute.
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