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Direct booking policies

How to configure Direct cancellation and payment terms that fit your business.

Andrew Schorr avatar
Written by Andrew Schorr
Updated this week

A default booking policy is required for Direct so Hospitable knows how you want us to manage your payments and refunds. Configure your terms and associate them to properties using our booking policy manager.

Cancellation policies

We provide a set of four templates to help get you started: Non-refundable, Strict, Balanced, and Easy. You may select and edit any of those suggested rule sets, or add your own policy from scratch.

Start by setting up your default policy. If some of your properties require different terms, you can individually scope select properties to another policy. Make sure to check whether the jurisdictions you operate in have laws governing your cancellation and refund policies.

Reservations take the policy that is active when the booking is made. If you make changes to your cancellation policy, this will only impact future bookings.

After booking rules

You may choose to offer guests a partial or full refund of their booking if they cancel within 24- or 48-hours of the booking request being accepted by the host.

You can set an additional condition on this rule if you don't want to honor it on last-minute reservations. If you set this value to 0 days, that means you will always honor the rule, even for last-minute bookings. Regardless of any after-booking rule, all cancellation rules expire at the check-in time of the reservation.

Before check-in rules

You may set multiple rules that offer full and partial refund checkpoints based on the number of days in advance of the check-in. Once the time period for all rules has passed, the reservation becomes non-refundable (ie. you don't need to add a 0% rule).

Partial versus full refunds

If a booking is 100% refundable, Hospitable refunds the exact amount the guest paid, including the service fee, at no cost to the host. For Direct Basic hosts, note that Stripe will still debit your account for the payment processing fees on the original reservation, so a 100% refund will end up costing you money. You can avoid losing money on refunds by scheduling your payment terms to only collect funds as they become non-refundable.

For rules that offer a partial refund, Hospitable will regardless refund 100% of any cleaning and linen fees, including taxes. We then apply the applicable refund percentage on the nightly rate, fees included in the nightly rate (resort, management, and community fees), taxes, and our service fees.

Payment terms

Payment terms let you offer guests the option, at no additional cost, to pay in up to three installments. This can help you improve conversions especially on large bookings and long lead times.

Based on your booking policy, the booking amount, and the lead time of the reservation, Hospitable may offer the guest the option to pay in two or three payments, instead of one upfront payment.

Payment terms are currently available for Direct Premium reservations only. We hope to extend the feature to Direct Basic before the end of July 2024.

Grace period

Hospitable notifies the guest ahead of each upcoming payment and attempts to automatically capture the funds. If we are unable to capture the funds, we notify the guest of the failed payment and share a link to switch to another payment method. We then reattempt to capture payment every 24 hours during your grace period.

If we are unable to capture the funds before the end of the grace period, the booking will be canceled according to your cancellation policy. You can set a grace period of 48 hours, 72 hours, or 1 week.

Aligning payment terms with your cancellation policy

We recommend using this option to align your payment terms with your cancellation policy. This insures that Hospitable always collects the appropriate amount to cover the non-refundable portion of your booking if the guest cancels.

Let's consider an example of a $10,000 reservation booked six months in advance:

Checkpoint

Cancellation Policy

Payment terms

Booking

100% refund until 45 days before check-in

First payment is a 20% deposit of $2,000 at booking

T-45 days

50% refund until 10 days before check-in

Second payment of $3,000 to fund the 50% non-refundable portion of the booking

T-10 days

Non-refundable within 10 days

Third payment of $5,000 balance

An important take away from the example above, is that we can only offer guests the option to make multiple payments if you have a cancellation policy with sufficiently spaced refundable checkpoints.

Or set a custom payment schedule

Use this option if you prefer to set your own payment schedule independent of your cancellation policy.

One danger with this option is that it's possible to "break" your cancellation policy. Consider that the non-refundable fees of your cancellation policy can only be enforced if you have collected the money ahead of time. You will not be able to collect additional funds from a guest if they cancel. Put another way, your payment schedule should never be behind, or on a slower schedule, than your cancellation policy checkpoints.

Disabling payment terms

If you prefer not to offer guests the option to pay in installments, you can use the Guests always pay 100% upfront option to disable payment terms.

Note that in the previous two options, Hospitable only offers guests the option to make multiple payments, they can still choose to pay in one upfront payment if they prefer.

Apply your rule to your properties

All properties must have a booking policy at all times. To change your default policy, set the policy you want to become your new default policy as the default. You can override the default policy by assigning a different policy to individual properties.

See also

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