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Advance Payment

In the woods @ the...
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12 posts
3 reviews
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Advance Payment

Will someone please educate me as to why most rentals require full payment as much as seven months in advance? I understand the fact that some people don't show up, and the owner/manager wants

protection from lost income. HOWEVER, if I am willing to give my

credit card number, understanding that I will be charged whether I

show up or not, why should I be charged months ahead of actual

usage?

Thanx

Grecia, Costa Rica
Destination Expert
for Province of Alajuela
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7,993 posts
43 reviews
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1. Re: Advance Payment

Thats a good question... and one I don't really have an answer to.

Back when I was a hotel owner, we would get the credit card number, and charge for 1 night of the stay. Depending on if there was a cancellation, would dictate how much a penalty there was in the end.

If someone for instance had cancelled within a week of traveling, that puts the hotel in a bad situation of having to try and fill space at the last minute. The penalty would be more than just the single night that had already been charged.

As a general rule though, if we were able to sell the space on a last minute cancellation, then we gave a full refund minus just the 1 night originally charged... Reasoning is "No Harm, No Foul"

Most hotels are like this, some policies are worse than others, and many hotels here are not as friendly as we used to be in this regard.

If you are talking a rental property such as a condo, then I have no idea as to how they write or why they write their policies the way they do, I can only speak of my own experience.

If you pay with a credit card, and you should, then if there is a dispute it will almost always go in your favor.

Cheers

Punta Uva, Costa...
Destination Expert
for Puerto Viejo de Talamanca
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6,874 posts
10 reviews
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2. Re: Advance Payment

You have a choice, don't go with them. Most places put a hold on your card and might charge you for the first night, others wait till you get there, there might be cash discounts, so charging for the whole amount is not ok with me!

In the woods @ the...
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12 posts
3 reviews
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3. Re: Advance Payment

Clarification:

My dilemma involves a one month rental of a small guest house/cabana. So,

no "company" to deal with. The second month involves a condo owner.

Costa Rica
Level Contributor
25,654 posts
25 reviews
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4. Re: Advance Payment

Paying full price for something 7 months ahead of time seems a bit much to me. If you really really like these places, try to negotiate with the owners to pay a deposit and set up some terms for that. Maybe agree to pay a deposit and then the full amount one month ahead of time -- something like this.

San Jose, Costa Rica
Level Contributor
459 posts
22 reviews
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5. Re: Advance Payment

My experience is if it is so much in advance, I ask for 25%, then 25% month before and the balance 5 days in advance.

Think of how many people the condo/hotel owner had to say no to because they trust you will show up.

Also depends a LOT on what season, if it is in low season you can ask for a lower deposit but in high season and specially around new years, I wouldn't expect a low deposit.

Payment in full 7 months in advance is a red flag.

Uvita, Costa Rica
Destination Expert
for Uvita, Ojochal
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2,649 posts
44 reviews
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6. Re: Advance Payment

See if you can negotiate as mentioned above as suggested by Rohrmoser, it is very hard to charge a CC in Costa Rica without a signature and put a hold unless you are a business like hotel and individual probably has no use for your credit card number.

San Jose, Costa Rica
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459 posts
22 reviews
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7. Re: Advance Payment

Paypal works very well. But I do have to admit - most people that rent properties rely on bank transfers.

If they do accept credit cards, most of the time they will send a credit card authorization form.

Edited: 04 August 2011, 01:04
Winnipeg, Canada
Destination Expert
for Costa Rica
Level Contributor
7,345 posts
28 reviews
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8. Re: Advance Payment

I'll talk about the subject from our personal perspective.

We own a small condo which we rent out independently. We have only one unit to rent, yet we still pay for advertising on several sites like VRBO, Tripadvisor etc. , a web site which we created, in addition to monthly costs of condo fees, electric, cable TV, phone and internet. Since it s a pretty modest place the money we can take in is relatively low.

Our policy at present is 1/2 of the rental amount upon booking and the balance 45 days before arrival. We do not take credit cards or Paypal or the likes since it ends up too expensive for what we can charge. It just is not worth it for us. (Others may think differently)

Once we receive the deposit, we immediately block off the dates. So - from then on opportunity to rent those days is gone. Most of our demand is for the period between Xmas and Easter People looking for longer term (2 weeks or more) tend to do their research and book several months in advance. If someone cancels - there is no way to get back those people who might have been interested but booked elsewhere.

A client can protect himself by buying Trip Cancellation Insurance to cover his costs if forced to cancel for allowable reasons. The owner can't.

Larger complexes and hotels have more to work with and can allow themselves to have more liberal cancellation policies. Not so much so for the little guys.

All that said - to me full payment - non refundable - 7 months ahead is a lot to ask.Don't think it is the norm.. A non refundable deposit - and payment a reasonable time in advance - yes.

pura vida

raquel

San Jose, Costa Rica
Level Contributor
46,644 posts
35 reviews
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9. Re: Advance Payment

Seven months ahead of time ...is way to much time...I will go with Raquel rules...I like them and I think they are nice a fair...

Most of the time once you pay ...no way you will see a penny back...GUARANTEE...be extra carefull who you prepaid...

roadadvisor

10. Re: Advance Payment

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