Vrbo Cancellation Policy: Short Guide for Hosts

vrbo cancellation policy

By The Hospitable Team

Vrbo is among the best in the business when it comes to listing your property for short-term rentals, just like Airbnb and Booking.com. If you create a Vrbo listing for your vacation rental, you can expand your audience reach worldwide, increase the number of paying guests and earn more money with your rental property.

When travelers book holidays, their goal is to complete their stay, but sometimes, cancellations are unavoidable. That’s why a Vrbo cancellation policy is a must-have for any host. This way, you’ll provide your guests with the necessary information about their booking and be covered if your guests don’t show up.

If you are planning to expand the presence of your short-term rental business beyond Airbnb, Vrbo is a great place to start. The other excellent option is Booking.com. Our extensive guide on hosting at Booking.com will set you to full speed.

Vrbo Cancellation Policy: What Are Your Options?

It’s up to you as a host to set your cancellation policy for your listing, and Vrbo offers you 5 options to choose from.

  • No refund policy. It’s the strictest option; no refunds are offered for any reason or timeframe.
  • Strict policy. Guests will receive a full refund if they cancel at least 60 days before the start of the stay.
  • Firm policy. Guests get a full refund if they cancel their booking at least 60 days before their check-in date. If the guests cancel at least 30 days before their check-in date, they will get a 50% refund.
  • Moderate policy. This option is recommended for hosts by Vrbo. Guests receive a full refund if they cancel at least 30 days before their check-in date. If the guests cancel their bookings less than 30 days before the start of the stay, they get a 50% refund.
  • Relaxed policy. Bookings canceled at least 14 days before the check-in date will receive a 100% refund. If the guests cancel their booking at least 7 days before check-in, they get a 50% refund.

Some properties are allowed to set a custom cancellation policy and determine specific cancellation terms and fees associated with them. Hosts should inform guests about their custom cancellation policy on their property page and provide access to their terms for review.

Choosing an overly strict cancellation policy on Vrbo would be a bad mistake considering the current state of travel.  Guests want to feel confident that if any travel restrictions are imposed, they won’t be completely out of pocket. Download our guide of avoiding other hosting blunders and make sure to learn from the mistakes of others.

How to Cancel a Guest’s Reservation?

If guests are eligible for a 100% refund, they can cancel bookings through their account and will get a refund based on your cancellation policy. If a guest is not eligible for a full refund, they can request to cancel the booking from their account. When cancellations are initiated by guests directly or through a formal request, they won’t affect your ranking metrics.

If your approval is needed to confirm the cancellation, here is what you should do.

  • Log in to your Vrbo account.
  • If you have several listings, click on the appropriate property.
  • Go to the Inbox and find the appropriate guest’s name in the All Messages drop-down menu.
  • Make sure the guest has requested a cancellation from the My Trips section of their account.
  • Click Confirm cancellation from within the chat area to approve a guest’s cancellation request.

Sometimes, you may need to cancel a booking. But you should keep in mind that if you initiate the cancellation without any valid reason, it will negatively affect your listing performance and revenue. So you should do your best to avoid cancellations and decline altogether.

Then travelers will be able to fully understand what the terms are when they are booking your property. They will know what to do when they want to submit a cancellation request within the specified timeframe.

It’s essential to keep your calendar accurate and block dates you know are unavailable, including direct bookings.  If you list your property on different OTA websites, vacation rental property management software will help you stay organized with instant calendar synchronization across multiple platforms, including Airbnb, Vrbo, Boking.com, and more.

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Vrbo recommends that you should cancel only when it’s really necessary. Here are the steps you should follow.

  • Log in to your account and click on the appropriate listing.
  • Click Inbox and filter your conversation in the All Messages drop-down menu.
  • Select the appropriate guest name.
  • Click Cancel booking at the bottom of the screen.
  • Choose the most relevant reason for the cancellation from the drop-down menu.
  • Review the refund amount and click Continue.
  • Click Confirm to process the refund amount and the cancellation.

Depending on your reason for the cancellation, you may qualify for a cancellation waiver. That may happen if the reason for cancellation is out of your control. Remember that Vrbo might ask you to prove this and provide documentation supporting your circumstances. Vrbo reviews requests for a cancellation waiver on a case-by-case basis for eligibility. And if you don’t receive a waiver, your cancellation will negatively affect your ranking metrics.

Vrbo allows hosts to cancel a booking with a cancellation waiver under the following conditions:

  • A natural disaster that makes your rental property unsafe for your guests, for example, a tornado, earthquake, hurricane, tsunami, or typhoon
  • Severe damage to your property that made it uninhabitable for guests, such as a gas leak
  • A severe violation of your house rules made by a guest or when they refuse to follow the rules and won’t request a cancellation via their traveler account
  • Past due balance—when a guest hasn’t completed the second or third payment to complete the booking by the due date.

How to Edit Cancellation Policy?

What if you decide to change your Vrbo cancellation policy? You can do it if you go to the Vrbo dashboard. You’ll need to select the listing that you want to adjust and click Rules & Policies. Then click the Cancellation Policy tab and choose the policy you would like to use. Finally, you need to save the changes you have made.

Keep in mind that the changes you have made will only apply to new bookings. All bookings that were made before this change will still be subject to your previous cancellation policy.

Can You Choose to Offer No Refunds?

Guests can get refunds based on the refund policies that Vrbo hosts have chosen for their listings. So it’s up to hosts to decide whether they will offer refunds or not.

If guests cancel bookings through their traveler account, they get refunds automatically based on the cancellation policy you set up within the Rules & Policies section of your account.

You may also decide to refund your guest more than your cancellation policy allows. Then you can process the refund in your Reservation manager.

Vrbo considers your property’s cancellation policy when determining service fee refunds. If the guest is within the window to receive a 100% back, and you’ve refunded the full amount, Vrbo will automatically refund the service fee. It doesn’t matter who initiated the cancellation. Besides, they will return the commission and payment processing fees on the booking.

But when you issue a partial refund, booking and service fees won’t be refunded. As to the payment processing fee, it will be reversed for the amount refunded.

How to Avoid Cancellations

Cancellations and declines have a big impact on your revenue. And when you cancel, it negatively impacts your performance and overall visibility to guests. So if you know you can’t accept a booking, try to decline it as soon as possible. If you let the booking automatically decline after the 24-hour window, it will have a negative impact on your market rank and could lead to bad reviews.

You’ll be able to avoid the majority of cancellations if you do your best to create a great booking experience for potential guests and alleviate many common traveler pain points. You should keep your calendar updated, set up your minimum stay requirement, set up your house rules, and create a clear cancellation policy.

It’s also important to be flexible and ensure open communication with your guests. This way, you’ll create a perfect experience for your guests and good reviews for you. Vacation rental management involves a lot of work, but you can use Hospitable to automate routine tasks and save a lot of time.

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Vrbo Cancellation Policy Coronavirus: Best Practices

Vrbo recommends hosts implement the following measure to handle cancellations due to COVID-19.

You should update your Vrbo cancellation policy and adopt and flexible or moderate policies for your vacation rental property. As the travel restrictions are constantly changing, guests are more likely to book properties that have more flexible cancellation policies.

If your short-term rental property is directly affected by travel restrictions, you should block your calendar or temporarily hide your listing until the end of the travel restriction. It’s important to stay up-to-date with local laws and regulations. Then you won’t have to cancel bookings last minute.

Recommended further reading: a guide on avoiding popular mistakes that even experienced hosts sometimes make.

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