How can I get a refund for a canceled vacation rental?

Here's how you can get a refund for your canceled vacation rental.

When Marilyn Harrett called off her Hawaii vacation this spring, she thought she could get a refund for a canceled vacation rental. After all, her state was locked down and so was the Aloha State. There was no way she’d be able to make it to her rental in Maui.

Oh, and one more thing: She had an email from the vacation rental company promising her a refund. Slam dunk, right?

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Wrong.

Harrett’s case illustrates the complexities of getting a refund for a vacation rental during the pandemic. Because rentals can involve up to three parties — an owner, a manager and a booking site — getting your money back isn’t always so straightforward. There are also ever-changing refund policies, which can make it difficult to know your rights to a refund from one day to the next.

And Harrett’s case was even more confusing because the owner of her property, who lives in New Zealand, had just purchased the property. Her deposit was part of the escrow.

Can you get a refund for a canceled vacation rental in Hawaii?

After a long winter in Seattle, Harrett looked forward to spending a few restful days in Maui this March. The modest condo she rented at Maui Kai overlooked a calm Pacific with postcard-perfect views of Molokai and Lanai in the distance.

But then COVID-19 happened, and I don’t have to tell you about what happened next. Washington and Hawaii locked down, and they still haven’t fully reopened. Reluctantly, Harrett contacted Maui Paradise Properties to cancel.

She was happy to receive a quick response from the management company:

Over the past weeks, as more communities, including the federal government, have called for increased social distancing and a mandatory 14-day quarantine into Maui to help contain the virus, we have re-evaluated our cancellation policy.

Every community’s public health needs are different, so we want to make sure we play a constructive role by taking responsible actions, guided by the WHO, the CDC and other experts, to continue to do what’s right for our guests, owners and team.

We recognize that the current environment has and will limit your ability to keep your travel plans; therefore, we will

(1) soften our 60-day cancellation policy to a 30-day cancellation for all new bookings arriving by December 15, 2020;
(2) offer you the option to change your booking dates for a future date – something fun to look forward to when the dust settles and it will
(3) work with you on a refund.

[emphasis added]

Harrett interpreted that as a refund offer. She let Maui Paradise Properties know that she did indeed want them to work on a refund, and they promised to do so.

This refund request is a little complicated

But two months later, Harrett was still missing the $2,000 she paid the rental management company. She began doing some digging on the specific condo unit she had rented, and discovered, and discovered that it had been sold recently. Could that be the reason for the delay in her refund?

She reached out to Maui Paradise Properties again. A representative promised to find out the status of her refund request. The company followed up with an email:

Thank you for reaching out and for the reminder and your continued patience. The money from your payment was included in the escrow when the sale of the condo closed. That money was sent to the new owner. He lives in New Zealand.

With the pandemic, New Zealand was completely shut down and the owner didn’t have a way to send the money back to us to refund you.

Now that New Zealand has allowed their residents to resume regular activities, he has sent the money out. As soon as I receive confirmation that we’ve received the funds, your refund will be issued.

That’s strange. I hadn’t heard about banking problems in New Zealand during the coronavirus lockdown, but at least the money was on its way.

Or was it?

A month later, still no refund. Harrett contacted my advocacy team for help, hoping we could shake something loose from Maui Paradise Properties.

Trying to get a refund for a canceled vacation rental is like hitting a moving target

Harrett’s problem is pretty common during the COVID-19 pandemic. We’ve helped with Airbnb refunds and Vrbo refunds, and our help forums have been extremely active with canceled vacation rental refund cases.

But, as I said, things could have been more complicated for Harrett. She could have rented from one of the larger online sites. But regardless of which company Harrett had rented from, refund policies are all over the map.”

Airbnb: a moving refund window

Shortly after the outbreak, Airbnb rolled out a new extenuating circumstances policy. That’s the clause under which you can claim a full refund for your canceled vacation rental per Airbnb’s terms and conditions.

Airbnb said that for reservations made before March 14, guests could choose between a refund or issue travel credit that includes all service fees. As the pandemic worsened, Airbnb extended the dates for its policy, most recently moving them from June 15 to July 31 for refund eligibility.

Neither guests nor hosts were entirely happy. Guests had to prove their circumstances were indeed “extenuating” — usually some written evidence that they couldn’t make their trip. And hosts were forced to offer refunds, losing revenue that they were counting on to pay their bills and mortgages.

By the way, here are Airbnb’s executive contacts just in case you need them.

Vrbo: leaving it to owners

Vrbo’s cancellation policy favored owners. It asked — but did not require — property owners and managers to offer a full credit for the amount its guests had already paid if they were outside of the cancellation window. Vrbo “strongly” encouraged property owners and managers to issue at least a partial refund for situations in which guests couldn’t accept a credit.

Although this policy worked for many guests — and, obviously, for many owners — we had a fair number of complaints from travelers who faced a total loss of their deposits. I asked Vrbo President Jeff Hurst about its policy in a recent Forbes interview.

“Our policy was designed to do what was right by everyone involved, including travelers, property managers and the public,” he told me. “Because Vrbo is a two-sided marketplace, for every traveler who has to cancel a getaway because of COVID-19, there’s a small business owner who relies on their cancellation policies to pay their mortgage and employees.”

Our best advice for dealing with a Vrbo refund: Negotiate and, if necessary, escalate. Here are some executive contacts at Vrbo.

Mission accomplished?

But back to Harrett’s case. The contract she’d signed with her vacation rental management company didn’t allow for any refunds. But after the pandemic, the company modified its refund policy and offered her a refund in writing.

My advocacy team thought she’d waited long enough for the company to do what it agreed to do. So our advocate, Dwayne Coward, reached out to Maui Paradise Properties on her behalf. In response, the company sent her a $1,090 refund.

“At this point, I am happy,” she told Dwayne. She had only expected to receive a refund on her taxes and cleaning fees until Maui Paradise Properties offered to refund everything.

We’ll stay on this case until she gets all of her money back, of course.

A few tips on how to get a refund for a canceled vacation rental

Vacation rental cases can get complicated, and refunds take time. Sometimes too much time. But there are a few ways to ensure you’ll get your money back, regardless of the refund policy.

  • Read the policy carefully before asking for a refund. Even if the policy doesn’t favor you, knowing what you can — and can’t — ask for is an important starting point. Incidentally, here’s Maui Paradise Properties’ policy.
  • Contact the owner directly and politely request a refund. If possible, deal directly with the owner. Owners can figure out the best way to generate a refund. I’ve seen owners and guests work together to secure a refund, particularly when dealing with the major vacation rental companies.
  • If necessary, escalate to an executive. There’s almost always someone to whom you can appeal. That includes an executive at one of the vacation rental sites or someone at one of the vacation rental management companies. And, as a last resort, consider filing a credit card dispute.

Bottom line? Yes, you should be able to get a refund for a canceled vacation rental during the COVID-19 outbreak. No one should have to pay for a condo they can’t use. That’s never been more true than now.

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