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Hotel.com Pre-Authorisation & ‘No Deposit’ Policies

Nov 22, 2019 | Travel

If you’ve used Hotel.com, or a similar hotel booking site, you may have read they have a no deposit policy, only to find out later the hotel you booked did remove funds from your account, ostensibly to be used toward your booking.

Other individuals have had the same problem, with some saying the hotel took about half the cost of their stay directly from their account. This amounted close to £200, in one case.

At first, you may believe this is a mistake; however, when contacting the hotel or the booking site, you learn they have taken a ‘pre-authorisation’ amount out of your account (if you paid with a debit card) or may have placed a hold on your credit card. The booking site advertises “no deposit,” so what’s going on?


Hotel Booking Sites Terms & Conditions

If you’ve read through other articles and guides on our site, you may have noticed that we always stress the need to read the terms and conditions thoroughly. This is the case when buying anything, including any type of insurance, applying for a new credit card, etc. The same applies when it comes to hotel booking sites and hotels.

When you read through the terms and conditions on a site such as Hotel.com, you’ll come across the following:

‘You shall provide the details of your payment card and the supplier or Hotels.com will often have to verify: (ie) the validity of the payment card (through a charge of a nominal value that is either refunded within a few days or deducted from the final payment due to the supplier) and, (ii) the availability of funds on the payment card (to be confirmed by the bank issuing your credit card). Hotels.com reserves the right to cancel your booking if full payment is not received in a timely fashion (please see Supplier Rules and Restrictions).’

This can sound a little complicated, but what the statement actually means is that either the booking site or the hotel where you’ll stay can put a nominal value hold (of a small amount) if you pay with a credit card, or they may actually take funds from your account if you pay with a debit card. The funds may be a portion of the charge of your entire hotel stay, which will be deducted when you check out or refunded after your stay.

So, when booking your hotel through a booking site, it pays to read the fine print before you make the reservation and are shocked later when they take money from your account or place a hold for a certain amount on your credit card.

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What to Do if They Take Too Much Money or Place a Large Hold?

Travel experts advise customers to contact the hotel booking site customer service reps or the hotel directly if you have a question about the funds they’ve taken or the hold on a card.

In some instances, the booking site will see the hotel took a nominal fee that was too large, etc. They may be willing to refund this amount, or could offer a voucher or discount, depending on the site.


How to Protect Yourself from These Charges

Here are some things you can do to avoid these types of charges or to minimize their impact in the future:

1). Read the cancellation policy: before making your reservation, be sure to read the hotel’s cancellation policy through entirely. Make sure you understand it—it doesn’t hurt to read through it a couple of times. Each booking site and each hotel will have their own cancellation policies. While you’re at it, remember to read through the terms and conditions of both the booking site and your hotel’s site.

Some hotels may require a 24-hour notice to cancel, while others may require 48 or more. Other hotels may require a week’s notice when you cancel your reservation. Some hotels also charge a cancellation fee, even if you cancel in the allotted time.

And to make matters even more confusing, the hotel booking site may have their own cancellation policy, which is completely different from the hotel’s.

2). Pay with a credit card: if at all possible, choose to pay for your booking with a credit card. When paying with a debit card, if you don’t have enough funds in your account, the pre-authorised amount may be higher than what’s in your account. The transaction won’t go through. Then you may lose your booking, or the hotel/booking site may contact you to let you know about the problem.

The pre-authorised amount may include taxes, the partial total of your stay, incidentals, etc. So, if you pay by debit card, it’s a good idea to make sure you have enough in your account to cover the entire stay, the taxes and the incidental charges before you book. When you check out, the amount they’ve removed from your account will be applied to your bill, or may be refunded back to your account, depending on the hotel’s policy. Be aware the refund could take days or weeks before it shows up in your account.

Paying with a credit card is better, but make sure that you have enough on the card to cover the entire amount of stay. Another good thing about credit cards is they carry more protection when it comes to fraud, so you’ll be protected if the booking site or hotel over charge, etc.

3). Check your bill and accounts when checking out: be sure to review your bill when checking out. Hotels sometimes make billing errors, and it’s best to find these before you checkout. It’s easier to take care of these mistakes then, rather than later. It can take weeks or months to get your money back otherwise.

Hotel booking sites make finding and booking hotels more convenient, but make sure you understand all of their policies before you book a stay. It’s also a good idea to read the hotel’s terms and conditions, too, especially in regard to cancellation policies, pre-authorisations on your cards, etc.

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