A cancellation policy for your homestay: three tiers, worded to avoid disputes

HostBooking · Updated Oct 28, 2026 · 7 min read

A workable cancellation policy needs three tiers: cancel early for a full refund, cancel in the middle for half, cancel late or fail to arrive for nothing. What stops arguments is the wording: tiers stated as dates and times, the percentage tied to a clear amount, and the policy shown before the guest pays a deposit.

A three-tier template

This template is for nightly rooms with a 2 pm check-in. Change the days, times and working days to suit your place, then paste it into your website, house rules and guest messages.

1. Cancel 7 days or more before check-in time: 100% of the amount paid is refunded (deposit included).
2. Cancel between 3 and 7 days before check-in time: 50% of the amount paid is refunded.
3. Cancel within 3 days of check-in time, or do not arrive: no refund.
4. Tiers count from the 2 pm check-in time. Example: for check-in at 2 pm on 20 December, cancel before 2 pm on 13 December for 100%, before 2 pm on 17 December for 50%.
5. Date changes: give at least 3 days’ notice, one change, subject to availability; the price follows the new dates. A change within 3 days counts as a cancellation.
6. Weather and natural disasters: with an official storm warning for the area, or the road closed, the guest may move the stay free within 6 months or get 100% back.
7. Refunds are sent to the account the guest gives within 5 working days of cancelling.
8. Bookings made on Booking.com, Agoda, Airbnb or another channel follow that channel’s cancellation policy.

Three tiers are enough. A fourth or fifth makes the policy harder for guests to remember and for staff to apply. If late cancellations are costing you, move the second tier further out rather than adding one.

Wording that prevents arguments

• State tiers as dates and times, not "cancel early" or "a few days before". In each confirmation, write the actual date: "cancel before 2 pm on 13 December for a full refund".
• Say what the percentage is of: what the guest has paid, or the full room price. The two give very different numbers.
• Put it in dong in messages: a 2,000,000 ₫ booking with a 600,000 ₫ deposit, cancelled at the 50% tier, gets 300,000 ₫ back. Guests ask less when they see the figure.
• Say when the deposit is lost: under the template, only on cancelling within 3 days or not arriving. Avoid a blanket "deposits are non-refundable".
• Keep date changes apart from cancellations. A guest who wants new dates usually does not want to lose money, and a clear change rule keeps the booking without a refund.
• Give a refund deadline in working days, and where the money goes, so the guest does not chase you every day.

Deposits, no-shows and date changes

When you take only a deposit, base the refund on what the guest has paid. At the 100% tier they get the whole deposit back; at 50%, half of it. This is easier to explain than a share of the full price, because the guest never owes more for cancelling.

A guest who does not arrive and does not tell you gets nothing back: give this its own line. For hourly rooms a no-show means not being there at the booked time, so say how many minutes late counts as not arriving.

A date change is not a cancellation. If you allow it, limit how many times, how much notice, and say the price follows the new dates (holidays may cost more).

Weather, force majeure and OTA bookings

For storms, floods and landslides, choose in advance between a free date change and a full refund, and tie it to something the guest can check, such as an official weather warning for the area or a closed road. "Bad weather" on its own is where most disputes start.

OTA bookings are paid and cancelled under the policy you set on that OTA, and the OTA refunds the guest. Keep the OTA policy close to the one on your own site so a guest does not see two rules for the same room. If you sync your calendar with OTAs, dates a guest cancels there open up again on your calendar.

Consumer protection rules expect terms to be clear and shown before the guest pays. If you are unsure whether a term (keeping the whole price on a very early cancellation, say) is acceptable, ask a lawyer or the local authority before using it.

Where to show the policy

• On the room page of your website, near the price.
• In the booking form, before the guest pays the deposit: the place that matters most.
• In the booking confirmation and on the booking lookup page, with the actual date of each tier.
• In the house rules sent before arrival, and in your saved reply when guests ask.

Setting it up on HostBooking

Each property picks one level under Cancellation policy. Each level shows its refund lines, so you see exactly what a cancellation at each point gives back, for nightly and hourly stays:

Steps count from check-in time (or start time for hourly rooms); after the last step there is no refund, and a no-show gets nothing. Percentages are of what the guest has paid. The three-tier template above is a Custom policy: 7 days for 100%, 3 days for 50%. If the steps run backwards (more back closer to arrival), the settings page warns you.

Guests see the same lines on the room page and in the booking form, under the refund heading, before they pay. They can cancel on the booking lookup page until check-in time; before they confirm, the page shows the amount they will get back under the policy. When a guest cancels, the refund due appears on the list of payments needing attention, with its amount, and managers are notified. For money taken by QR bank transfer or cash, you send it back and record it on the booking.

Refunds need the right permission. Staff without the Refund permission send a request from the booking page, with a reason and the account to pay; someone with the permission approves or rejects it. See roles and permissions.

Changing the policy level on HostBooking also applies to bookings already made and not cancelled. If you tighten it, keep your word to earlier guests: when they cancel, refund the difference by hand.